What is a "rate lock period"?

Locking in your Interest Rate

When you are offered a "rate lock" from the lender, it means that you are guaranteed to get a specific interest rate for a determined period for the application process. This ensures that your interest rate cannot rise during the application process.

While there are various lengths of rate lock periods (from 15 to 60 days), the longer spans are usually more expensive. The lending institution can agree to lock in an interest rate and points for a longer span of time, say sixty days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of fewer days.

More Ways to Get a Great Interest Rate

There are more ways to get a better rate, besides agreeing to a shorter rate lock period. A bigger down payment will give you a reduced interest rate, because you're starting out with more equity. You can pay points to reduce your rate over the loan term, meaning you pay more initially. To a lot of people, this makes sense and is a good deal..

Diamond Mortgage, LLC can answer questions about rate lock periods & many others. Call us: 3178427744.