Getting a Low Interest Rate

Locking It In

A rate "lock" or "commitment" is a lender's promise to lock in a particular interest rate and a particular number of points for you for a specified period of time while your application is processed. This keeps you from working through your entire application process and finding out at the end that your interest rate has gone up.

Rate lock periods can vary in length, anywhere from 15 to 60 days, with the longer period typically costing more. A lending institution can agree to freeze an interest rate and points for a longer period, say 60 days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of fewer days.

Other Ways to Save on Interest

There are other ways to get a reduced rate, besides opting for a shorter rate lock period. The larger down payment you make, the lower your interest rate will be, since you will have more equity from the start. You could opt to pay points to bring down your rate over the term of the loan, meaning you pay more initially. For a lot of people, this is a good option..

Pacificwide Lending can walk you through the pitfalls of getting a mortgage. Give us a call: 9254610500.

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Pacificwide Lending

CA License #01762647 NMLS#241222, TX License #241222, FL License # MBR 3291

7041 Koll Center Pkwy Ste 270 Ste 270
Pleasanton, CA 94566