Getting a Low Interest Rate
Locking It In
When you're offered a "rate lock" from your lender, it means that you are guaranteed to get a set interest rate for a determined period for your application process. This means your interest rate cannot rise during the application process.
Rate lock periods can vary in length, between 15 to 60 days, with the longer period typically costing more. You can get a longer period for your lock, but in making this choice, will likely have a higher rate than you would have with a shorter span of time
Other Interest Saving Strategies
There are other ways to get a reduced rate, in addition to going with a shorter rate lock period. A larger down payment will get you a lower interest rate, because you will have more equity at the start. You can pay points to lower your rate for the loan term, meaning you pay more up front. One strategy that is a good option for some is to pay points to reduce the rate over the life of the loan. You will pay more initially, but you'll save money, especially if you don't refinance early.
At Saab Mortgage, we answer questions about this process every day. Call us: 703-288-0777.
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