Getting a Low Interest Rate

What is a Rate Lock?

When you're promised a "rate lock" from a lender, it means that you are guaranteed to keep a set interest rate over a certain number of days for your application process. This keeps you from going through your whole application process and discovering at the end that the interest rate has gotten higher.

Although there are various lengths of rate lock periods (from 15 to 60 days), the extended spans are generally more expensive. You can get a longer period for your lock, but in choosing this option, will probably have a higher rate than you would with a shorter span of time

Other Interest Saving Strategies

There are other ways to get a reduced rate, besides choosing a shorter rate lock period. A bigger down payment will get you a lower interest rate, because you will have more equity from the beginning. You can pay points to bring down your rate over the loan term, meaning you pay more up front. One strategy that makes financial sense for many people is to pay points to bring the rate down over the term of the loan. You'll pay more initially, but you'll save money in the end.

Alternative Mortgage Group can answer questions about rate lock periods and many others. Give us a call at 561-395-4264.