Getting a Low Interest Rate
What is a Rate Lock?
A rate "lock" or "commitment" is a promise from the lender to freeze a certain interest rate and a particular number of points for you for a certain period during your application process. This prevents you from getting through your entire application process and discovering at the end that your interest rate has gotten higher.
While there are various lengths of rate lock periods (from 15 to 60 days), the longer spans are generally more expensive. You can get a longer period for your lock, but in doing so, will probably have a higher rate than you would have with a shorter period
Other Interest Saving Strategies
In addition to opting for the shorter rate lock period, there are other ways you are able to attain the best rate. A bigger down payment will result in a lower interest rate, since you'll be starting out with more equity. You may choose to pay points to bring down your rate over the term of the loan, meaning you pay more initially. For a lot of people, this makes sense and is a good deal..
Prime Capital Mortgage Corp can answer questions about rate lock periods and many others. Give us a call at 248-644-1200.
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