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

Freezing the Rate

When you're offered a "rate lock" from the lender, it means that you are guaranteed to get a certain interest rate over a determined period for the application process. This ensures that your interest rate won't rise while you are working through the application process.

While there are several 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 choosing this option, will most likely have a higher interest rate than you would with a shorter period

More Ways to Get a Great Interest Rate

There are other ways to get a reduced rate, in addition to opting for a shorter rate lock period. A bigger down payment will give you a lower interest rate, because you'll be starting out with more equity. You might choose to pay points to bring down your interest rate over the loan term, meaning you pay more up front. One strategy that is a good option for many people is to pay points to improve the rate over the life of the loan. You pay more initially, but you'll come out ahead in the end.

AmeriBest Mortgage can walk you through the pitfalls of getting a mortgage. Call us: (321) 777-7277.

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