Getting a Low Interest Rate

Locking It In

When you're offered a "rate lock" from the lender, it means that you are guaranteed to keep a set interest rate for a determined period for your application process. This protects you from getting through your whole application process and learning at the end that the interest rate has gotten higher.

Although there can be a choice of rate lock periods (from 15 to 60 days), the extended spans are typically more expensive. You can get a longer period for your lock, but in making this choice, will likely have a higher interest rate than you would have with a shorter span of time

Other Ways to Save on Interest

There are more ways to get a good rate, besides opting for a shorter rate lock period. The bigger down payment you pay, the lower your interest rate will be, since you will have more equity from the beginning. You can pay points to reduce your interest rate over the term of the loan, meaning you pay more up front. One strategy that is a good option for some is to pay points to improve the interest rate over the life of the loan. You'll pay more up front, but you will save money in the long run.

Avalon Mortgage Services, Inc. can answer questions about rate lock periods & many others. Give us a call at (708) 403-5181.

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