What is a "rate lock period"?

What is a Rate Lock?

When you are promised a "rate lock" from a lender, it means that you are guaranteed to get a certain interest rate for a certain number of days while you work on your application process. This prevents you from getting through your entire application process and discovering at the end that the interest rate has gone up.

Rate lock periods can vary in length, between 15 to 60 days, with the longer spans generally costing more. You can get a longer period for your lock, but in doing so, will most likely have a higher rate than you would with a shorter rate lock period

More Ways to Get a Great Interest Rate

There are other ways to get a lower rate, in addition to choosing a shorter rate lock period. A larger down payment will result in a lower interest rate, since you will be starting out with more equity. You can pay points to lower your rate for the loan term, meaning you pay more up front. One strategy that is a good option for many people is to pay points to reduce the interest rate over the life of the loan. You'll pay more initially, but you'll come out ahead in the end.

At Bright Vision Mortgage, we answer questions about this process every day. Call us at (904) 342-3622.

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