Getting a Low Interest Rate
Lock It In
A rate "lock" or "commitment" is a lender's promise to hold a certain interest rate and a specific number of points for you for a specified period of time while your application is processed. This ensures that your interest rate will not grow during the application process.
Rate lock periods can be various lengths of time, anywhere from fifteen to sixty days, with the longer period usually costing more. You can get a longer period for your lock, but in choosing this option, will probably have a higher rate than you would have with a shorter rate lock period
More Ways to Get a Great Interest Rate
In addition to choosing a shorter lock period, there are other ways you can get the best rate. The larger down payment you pay, the smaller the interest rate will be, since you will have more equity from the beginning. You can pay points to improve your interest rate for the term of the loan, meaning you pay more initially. One strategy that makes financial sense for some is to pay points to improve the rate over the term of the loan. You will pay more up front, but you'll save money, especially if you keep the loan for the full term.