"Rate Lock" and other Ways to Get a Lower Interest Rate
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What is a Rate Lock?
When you're offered a "rate lock" from the lender, it means that you are guaranteed to keep a specific interest rate over a certain number of days for the application process. This saves you from getting through your whole application process and learning at the end that your interest rate has gone up.
While there are various lengths of rate lock periods (from 15 to 60 days), the extended spans are usually more expensive. You can get a longer period for your lock, but in doing so, will probably have a higher rate than you would with a shorter rate lock span of time
Other Ways to Save on Interest
In addition to choosing the shorter rate lock period, there are several ways you may be able to score the lowest rate. A larger down payment will get you a reduced interest rate, because you will be starting out with more equity. You may choose to pay points to reduce your interest rate for the life of the loan, meaning you pay more initially. To a lot of people, this makes sense and is a good deal.
HENRY MUNOZ LOAN OFFICER & SOUTH BAY EQUITY LENDING can answer questions about rate lock periods and many others. Call us: 3105133942.