What is a "rate lock period"?

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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 during your application process. This ensures that your interest rate won't rise during the application process.

While there can be a choice of rate lock periods (from 15 to 60 days), the extended ones are generally more expensive. You can get a longer period for your lock, but in doing so, will most likely have a higher interest rate than you would have with a shorter span of time

Additional Ways to Save on Interest

There are other ways to get a good rate, besides opting for a shorter rate lock period. The larger down payment you pay, the smaller your rate will be, because you will have more equity from the beginning. You might choose to pay points to lower your interest rate for the loan term, meaning you pay more up front. For a lot of people, this makes financial sense..

Abbey Mortgage can walk you through the pitfalls of getting a mortgage. Give us a call: 352-369-4200.

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