Getting a Low Interest Rate

Freezing the Rate

A rate "lock" or "commitment" is a lender's promise to freeze a particular interest rate and a certain number of points for you for a specified period of time during your application process. This keeps you from getting through your entire application process and discovering at the end that your interest rate has risen higher.

Although there might be a choice of rate lock periods (from 15 to 60 days), the longer spans are typically more expensive. You can get a longer period for your lock, but in making this choice, will likely have a higher interest rate than you would with a shorter rate lock period

More Ways to Get a Great Interest Rate

There are more ways to get a lower rate, in addition to choosing a shorter rate lock period. A larger down payment will result in a reduced interest rate, because you'll have more equity at the start. You might choose to pay points to bring down your interest rate for the loan term, meaning you pay more up front. One strategy that makes financial sense for many people is to pay points to bring the rate down over the term of the loan. You'll pay more up front, but you'll save money, especially if you don't refinance early.

At New Millennium Mortgage Co. NMLS: 331173, we answer questions about this process every day. Call us at (941) 366-5800.