Getting a Low Interest Rate

Locking It In

When you're offered a "rate lock" from the lender, it means that you are guaranteed to keep a specific interest rate over a certain number of days for the application process. This means your interest rate cannot rise as you are working through the application process.

Rate lock periods can vary in length, between fifteen to sixty days, with the longer ones usually costing more. You can get a longer period for your lock, but in doing so, will probably have a higher interest rate than you would have with a shorter span of time

Additional Ways to Save on Interest

There are other ways to get a reduced rate, besides agreeing to a shorter rate lock period. A bigger down payment will get you a reduced interest rate, since you are starting out with a good deal of equity. You can pay points to bring down your rate for the life of the loan, meaning you pay more up front. One strategy that is a good option for many people is to pay points to bring the rate down over the life of the loan. You'll pay more initially, but you will come out ahead, especially if you keep the loan for the full term.

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