"Rate Lock" and other Ways to Get a Lower Interest Rate
What is a Rate Lock?
When you are promised a "rate lock" from the lender, it means that you are guaranteed to get a certain interest rate for a determined period for your application process. This means your interest rate won't grow as you are going through the application process.
Although there may 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 doing so, will probably have a higher interest rate than you would have with a shorter rate lock period
Other Ways to Save on Interest
In addition to choosing a shorter lock period, there are several ways you may be able to get the lowest rate. The larger the down payment, the lower your rate will be, because you will have more equity from the start. You might opt to pay points to lower your interest rate over the term of the loan, meaning you pay more initially. For a lot of people, this makes financial sense..
Prime Capital Mortgage Corp can walk you through the pitfalls of getting a mortgage. Call us at 248-644-1200.
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