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

Locking in your Interest Rate

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

Although there can be a choice of rate lock periods (from 15 to 60 days), the extended ones are typically more expensive. A lending institution will agree to freeze an interest rate and points for a longer period, such as 60 days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of a shorter period.

More Ways to Get a Great Interest Rate

There are other ways to get a good rate, in addition to going with a shorter rate lock period. A larger down payment will give you a lower interest rate, because you're starting out with a good deal of equity. You can pay points to bring down your rate for the life of the loan, meaning you pay more initially. For many people, this is a good option..

At Boardwalk Mortgage, we answer questions about this process every day. Call us at 1-800-606-2794.