What is a "rate lock period"?

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What is a Rate Lock?

When you're promised a "rate lock" from your lender, it means that you are guaranteed to keep a specific interest rate over a certain number of days while you work on the application process. This saves you from going through your whole application process and discovering at the end that your interest rate has gone up.

Although there are various lengths of rate lock periods (from 15 to 60 days), the longer 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 rate than you would with a shorter rate lock span of time

More Ways to Save on Interest

There are other ways to get a low rate, besides agreeing to a shorter rate lock period. The bigger down payment you pay, the lower the interest rate will be, as you will have more equity from the beginning. You can pay points to reduce your rate over the term of the loan, meaning you pay more up front. To many people, this is a good option..

At M.P.S. Mortgage Company, we answer questions about this process every day. Call us: 7045420820.