Getting a Low Interest Rate
What is a Rate Lock?
A rate "lock" or "commitment" is a promise from the lender to lock in a particular interest rate and a certain number of points for you for a specified period during your application process. This means your interest rate will not get higher as you are working through the application process.
Although there can be a choice of rate lock periods (from 15 to 60 days), the longer ones are generally more expensive. A lending institution may agree to lock in an interest rate and points for a longer period, such as 60 days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of fewer days.
More Ways to Get a Great Interest Rate
There are more ways to get a low rate, besides agreeing to a shorter rate lock period. A larger down payment will result in a better interest rate, since you're starting out with more equity. You can pay points to improve your interest rate for the loan term, meaning you pay more initially. To many people, this makes sense and is a good deal..
New Millennium Mortgage Co. NMLS: 331173 can answer questions about rate lock periods & many others. Call us: (941) 366-5800.
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