Getting a Low Interest Rate
Locking It In
A rate "lock" or "commitment" is a promise from the lender to set a specific interest rate and a particular number of points for you for a specified period of time during your application process. This protects you from working through your whole application process and discovering at the end that the interest rate has risen higher.
While there can be a choice of rate lock periods (from 15 to 60 days), the longer ones are typically more expensive. You can get a longer period for your lock, but in choosing this option, will probably have a higher interest rate than you would with a shorter rate lock period
Other Ways to Save on Interest
There are more ways to get a low rate, besides opting for 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 term of the loan, meaning you pay more up front. For many people, this makes financial sense..
At Savers Home Loans, we answer questions about this process every day. Call us at (800) 974-0509.