A rate "lock" or "commitment" is a lender's promise to hold a specific interest rate and a certain number of points for you for a specified period of time while your application is processed. This means your interest rate can't grow while you are working through the application process.
Rate lock periods can be various lengths of time, anywhere from 15 to 60 days, with the longer ones generally costing more. You can get a longer period for your lock, but in making this choice, will probably have a higher rate than you would with a shorter span of time
There are other ways to get a lower rate, besides choosing a shorter rate lock period. The larger the down payment, the smaller your interest rate will be, as you will be entering the loan with more equity. You may choose to pay points to bring down your interest rate over the term of the loan, meaning you pay more up front. To many people, this is a good option..
Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.