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

Locking It In

When you're offered a "rate lock" from the lender, it means that you are guaranteed to get a certain interest rate over a certain number of days while you work on your application process. This prevents you from getting through your whole application process and finding out at the end that the interest rate has risen higher.

Rate lock periods can be various lengths of time, between 15 to 60 days, with the longer ones generally costing more. You can get a longer period for your lock, but in making this choice, will probably have a higher rate than you would have with a shorter rate lock period

More Ways to Get a Great Interest Rate

In addition to going with the shorter rate lock period, there are several ways you are able to get the lowest rate. The bigger down payment you pay, the lower the rate will be, because you will have more equity from the beginning. You could choose to pay points to lower your rate for the loan term, meaning you pay more initially. One strategy that makes financial sense for some is to pay points to improve the rate over the term of the loan. You will pay more up front, but you'll come out ahead in the end.

At U.S.A. Lending, Inc., we answer questions about this process every day. Call us: 305-967-7200.