What is a "rate lock period"?
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Locking in your Interest Rate
When you are offered a "rate lock" from your lender, it means that you are guaranteed to keep a set interest rate over a determined period for your application process. This means your interest rate won't go up during the application process.
Although there are various lengths of rate lock periods (from 15 to 60 days), the extended spans are usually more expensive. A lender will agree to hold an interest rate and points for a longer span of time, like 60 days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of a shorter period.
Other Interest Saving Strategies
There are more ways to get a reduced rate, besides agreeing to a shorter rate lock period. The larger down payment you make, the lower the rate will be, as you will be starting with more equity. You might choose to pay points to reduce your rate over the loan term, meaning you pay more initially. For a lot of people, this makes financial sense.
Chandler Mortgage LLC can walk you through the pitfalls of getting a mortgage. Call us at 480-390-4995.