Getting a Low Interest Rate

Freezing the Rate

A rate "lock" or "commitment" is a lender's promise to hold a specific interest rate and a certain number of points for you for a certain period during your application process. This means your interest rate will not grow during the application process.

Although there might be a choice of rate lock periods (from 15 to 60 days), the longer ones are usually more expensive. A lending institution may agree to lock in an interest rate and points for a longer span of time, like 60 days, but in exchange, the rate (and sometimes points) will be more than with a rate lock of a shorter period.

Other Interest Saving Strategies

In addition to opting for a shorter rate lock period, there are other ways you are able to get the best rate. A larger down payment will get you a reduced interest rate, since you're starting out with a good deal of equity. You can pay points to lower your interest rate for the loan term, meaning you pay more initially. For a lot of people, this makes financial sense..

At Avalon Mortgage Services, Inc., we answer questions about this process every day. Call us: (708) 403-5181.

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Avalon Mortgage Services, Inc. an Illinois Residential Mortgage Licensee

NMLS#:283614 Illinois license#: MB.0003198

9439 West 144th Place
Orland Park, IL 60462-2543