What is a "rate lock period"?

Locking in your Interest Rate

When you're offered a "rate lock" from a lender, it means that you are guaranteed to keep a certain interest rate for a certain number of days while you work on the application process. This ensures that your interest rate cannot go up during the application process.

Rate lock periods can vary in length, between fifteen to sixty days, with the longer period typically costing more. A lending institution may agree to hold an interest rate and points for a longer period, like sixty 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 other ways to get a reduced rate, besides agreeing to a shorter rate lock period. A bigger down payment will get you a lower interest rate, because you are starting out with a good deal of equity. You may choose to pay points to improve your rate for the term of the loan, meaning you pay more initially. For many people, this is a good option..

Affinity Mortgage Brokers can walk you through the pitfalls of getting a mortgage. Give us a call at 719-331-6278.

Got a Question?

Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.

Your Information
Your Question