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

Freezing the Rate

A rate "lock" or "commitment" is a promise from the lender to freeze a specific interest rate and a specific number of points for you for a certain period of time while your application is processed. This ensures that your interest rate won't grow during the application process.

Although there are various lengths of rate lock periods (from 15 to 60 days), the extended ones are generally more expensive. The lender will agree to lock in an interest rate and points for a longer span of time, such as sixty days, but in exchange, the rate (and sometimes points) will be higher than that of a rate lock of fewer days.

More Ways to Get a Great Interest Rate

In addition to opting for the shorter rate lock period, there are other ways you can score the lowest rate. The larger down payment you can make, the better the interest rate will be, because you will be starting with more equity. You can pay points to lower your rate over the life of the loan, meaning you pay more up front. One strategy that makes financial sense for some is to pay points to improve the interest rate over the term of the loan. You'll pay more up front, but you will come out ahead in the long run.

At AmeriBest Mortgage, we answer questions about this process every day. Give us a call: (321) 777-7277.

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Please answer the following questions to the best of your knowledge but it must be accurate in order to compare it to the offer you currently have. We hope to $ave you hundreds if not thousands of dollars over the life of your loan. If we can't than you'll be able to sleep better tonight knowing you got the best deal - today!

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