What is a "rate lock period"?

Locking It In

A rate "lock" or "commitment" is a lender's promise to freeze a certain interest rate and a certain number of points for you for a certain period of time while your application is processed. This protects you from going through your entire application process and learning at the end that the interest rate has risen higher.

While there are several lengths of rate lock periods (from 15 to 60 days), the extended ones are generally more expensive. The lender will agree to lock in an interest rate and points for a longer period, like 60 days, but in exchange, the rate (and sometimes points) will be higher than that of a rate lock of a shorter period.

Other Interest Saving Strategies

In addition to opting for the shorter rate lock period, there are several ways you can get the lowest rate. A larger down payment will result in a better interest rate, since you'll have more equity at the start. You can pay points to reduce your interest rate over the life of the loan, meaning you pay more initially. For a lot of people, this makes sense and is a good deal..

Bright Vision Mortgage can walk you through the pitfalls of getting a mortgage. Call us: (904) 342-3622.

Got a Question?

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.

Your Information
Your Question

2800 North Fifth Street Suite 301B
St. Augustine, FL 32084