Getting a Low Interest Rate

Locking It In

When you are offered a "rate lock" from the lender, it means that you are guaranteed to get a specific interest rate for a determined period while you work on your application process. This saves you from going through your whole application process and learning at the end that the interest rate has risen higher.

Although there are various lengths of rate lock periods (from 15 to 60 days), the extended spans are usually more expensive. The lending institution will agree to lock in an interest rate and points for a longer span of time, say 60 days, but in exchange, the rate (and sometimes points) will be more than with a rate lock of a shorter period.

More Ways to Get a Great Interest Rate

In addition to opting for a shorter lock period, there are other ways you can attain the lowest rate. The bigger down payment you can make, the lower the rate will be, because you will be starting with more equity. You could choose to pay points to bring down your interest rate for the loan term, meaning you pay more up front. One strategy that makes financial sense for many people is to pay points to improve the interest rate over the term of the loan. You'll pay more up front, but you will save money, especially if you don't refinance early.

Southwest Funding #841
Company NMLS # 303440 can walk you through the pitfalls of getting a mortgage. Call us: 5122916100.

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Southwest Funding #841
Company NMLS # 303440

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7901 Cameron Road Bldg 2 Ste 246
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