What is a "rate lock period"?
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What is a Rate Lock?
A rate "lock" or "commitment" is a promise from the lender to set a particular interest rate and a particular number of points for you for a specified period while your application is processed. This means your interest rate can't get higher during the application process.
Rate lock periods can be various lengths of time, between 15 to 60 days, with the longer ones typically costing more. A lending institution will agree to hold an interest rate and points for a longer span of time, say sixty days, but in exchange, the rate (and sometimes points) will be higher than with a rate lock of a shorter period.
More Ways to Save on Interest
In addition to choosing a shorter rate lock period, there are several ways you can get the lowest rate. The larger down payment you can make, the better the interest rate will be, because you will have more equity from the start. You can pay points to lower your rate over the loan term, meaning you pay more initially. For a lot of people, this is a good option..
Alpine Capital Mortgage can walk you through the pitfalls of getting a mortgage. Call us: (208) 726-5466.
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