Getting a Low Interest Rate
What is a Rate Lock?
A rate "lock" or "commitment" is a lender's promise to freeze a certain interest rate and a particular number of points for you for a specified period of time during your application process. This keeps you from getting through your whole application process and finding out at the end that the interest rate has gone up.
Rate lock periods can vary in length, between fifteen to sixty days, with the longer spans typically costing more. A lender will agree to lock in an interest rate and points for a longer period, say 60 days, but in exchange, the rate (and sometimes points) will be more than with a rate lock of fewer days.
Other Interest Saving Strategies
There are more ways to get a better rate, in addition to going with a shorter rate lock period. A larger down payment will get you a reduced interest rate, because you will have more equity at the start. You could choose to pay points to reduce your interest 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..
C2 Financial Corporation can answer questions about rate lock periods & many others. Call us at (727) 478-2797.
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