What is a "rate lock period"?

Freezing the Rate

When you're offered a "rate lock" from the lender, it means that you are guaranteed to get a certain interest rate for a certain number of days for your application process. This keeps you from working through your entire application process and finding out at the end that the interest rate has gone up.

Rate lock periods can be various lengths of time, anywhere from fifteen to sixty days, with the longer spans usually costing more. You can get a longer period for your lock, but in choosing this option, will probably have a higher rate than you would have with a shorter rate lock period

More Ways to Get a Great Interest Rate

There are more ways to get a good rate, in addition to agreeing to a shorter rate lock period. A bigger down payment will result in a lower interest rate, since you'll have more equity at the start. You may opt to pay points to reduce your rate over the loan term, meaning you pay more up front. To many people, this makes sense and is a good deal..

Augusta Mortgage Solutions can walk you through the pitfalls of getting a mortgage. Give us a call at 706-860-5514.

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