What is a "rate lock period"?

Lock It In

A rate "lock" or "commitment" is a promise from the lender to hold a certain interest rate and a particular number of points for you for a certain period of time while your application is processed. This means your interest rate cannot get higher during the application process.

Although there are several 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 making this choice, will most likely have a higher interest rate than you would with a shorter period

More Ways to Save on Interest

In addition to going with the shorter rate lock period, there are more ways you can score the lowest rate. A bigger down payment will result in a reduced interest rate, since you will have more equity at the start. You can pay points to improve your rate for the term of the loan, meaning you pay more up front. One strategy that is a good option for many people is to pay points to improve the rate over the life of the loan. You'll pay more up front, but you will come out ahead, especially if you keep the loan for the full term.

Amity Mortgage LLC can answer questions about rate lock periods & many others. Give us a call at 2037296681.

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