"Rate Lock" and other Ways to Get a Lower Interest Rate

What is a Rate Lock?

When you're promised a "rate lock" from a lender, it means that you are guaranteed to keep a particular interest rate over a determined period for your application process. This means your interest rate can't rise while you are going through the application process.

Rate lock periods can be various lengths of time, between fifteen to sixty days, with the longer period generally costing more. You can get a longer period for your lock, but in choosing this option, will likely have a higher rate than you would with a shorter rate lock period

Other Interest Saving Strategies

There are more ways to get a good rate, in addition to agreeing to a shorter rate lock period. The bigger down payment you pay, the better the interest rate will be, as you will be entering the loan with more equity. You can pay points to reduce your interest rate for the loan term, meaning you pay more up front. One strategy that makes financial sense for many people is to pay points to bring the rate down over the term of the loan. You pay more up front, but you'll save money, especially if you don't refinance early.

At Omni Mortgage Corp., we answer questions about this process every day. Call us: 7184417000.

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Omni Mortgage Corp.

118-18 101st Avenue
Richmond Hill, NY 11419