"Rate Lock" and other Ways to Get a Lower Interest Rate
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Lock It In
A rate "lock" or "commitment" is a promise from the lender to hold a particular interest rate and a certain number of points for you for a certain period of time while your application is processed. This saves you from getting through your entire application process and discovering at the end that your interest rate has gone up.
Although there can be a choice of rate lock periods (from 15 to 60 days), the extended spans are generally more expensive. You can get a longer period for your lock, but in choosing this option, will likely have a higher interest rate than you would have with a shorter period
More Ways to Get a Great Interest Rate
In addition to opting for the shorter lock period, there are other ways you may be able to attain the lowest rate. The larger the down payment, the lower the rate will be, because you will have more equity from the start. You might opt to pay points to improve your interest rate over the loan term, meaning you pay more up front. One strategy that is a good option for some is to pay points to bring the rate down over the life of the loan. You are paying more initially, but you will come out ahead, especially if you don't refinance early.
ICM Lending can walk you through the pitfalls of getting a mortgage. Call us: 714-713-9193.
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