Getting a Low Interest Rate
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What is a Rate Lock?
A rate "lock" or "commitment" is a lender's promise to hold a specific interest rate and a particular number of points for you for a certain period during your application process. This means your interest rate can't get higher while you are working through the application process.
Although there may be a choice 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 making this choice, will most likely have a higher interest rate than you would with a shorter span of time
Other Interest Saving Strategies
In addition to choosing the shorter rate lock period, there are other ways you may be able to get the best rate. A bigger down payment will get you a better interest rate, since you are starting out with more equity. You may opt to pay points to bring down your rate over the life of the loan, meaning you pay more initially. To a lot of people, this is a good option.
At Diamond Mortgage Lending, we answer questions about this process every day. Give us a call: 888-365-2023.