"Rate Lock" and other Ways to Get a Lower Interest Rate

Lock It In

When you are promised a "rate lock" from your lender, it means that you are guaranteed to keep a certain interest rate for a certain number of days while you work on the application process. This keeps you from getting through your whole application process and learning at the end that the interest rate has risen higher.

While there may be a choice of rate lock periods (from 15 to 60 days), the longer ones are typically more expensive. The lending institution will agree to lock in an interest rate and points for a longer span of time, say sixty days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of a shorter period.

More Ways to Get a Great Interest Rate

There are more ways to get a low rate, in addition to agreeing to a shorter rate lock period. A larger down payment will give you a reduced interest rate, since you're starting out with a good deal of equity. You can pay points to reduce your interest rate over the loan term, meaning you pay more initially. One strategy that makes financial sense for some is to pay points to reduce the interest rate over the life of the loan. You'll pay more up front, but you will come out ahead in the long run.

CHASE MORTGAGE, Inc. #317430 can walk you through the pitfalls of getting a mortgage. Call us at 4357556622.