Getting a Low Interest Rate
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Lock It In
When you're promised a "rate lock" from your lender, it means that you are guaranteed to get a particular interest rate for a certain number of days for the application process. This keeps you from getting 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 longer spans are usually more expensive. The lending institution may agree to lock in an interest rate and points for a longer span of time, like sixty days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of fewer days.
More Ways to Get a Great Interest Rate
In addition to going with a shorter lock period, there are other ways you may be able to get the lowest rate. A bigger down payment will give you a reduced interest rate, because you are starting out with more equity. You may choose to pay points to reduce your interest rate for the term of the loan, meaning you pay more up front. To a lot of people, this makes sense and is a good deal.
Pacific Mortgage Consultants can walk you through the pitfalls of getting a mortgage. Give us a call at 530-677-2703.