Getting a Low Interest Rate

Locking in your Interest Rate

When you are promised a "rate lock" from a lender, it means that you are guaranteed to keep a specific interest rate for a determined period for your application process. This protects you from working through your entire application process and finding out at the end that the interest rate has gone up.

Although there can be a choice of rate lock periods (from 15 to 60 days), the longer ones are usually more expensive. A lender will agree to hold an interest rate and points for a longer period, like sixty days, but in exchange, the rate (and sometimes points) will be higher than that of a rate lock of a shorter period.

More Ways to Get a Great Interest Rate

There are more ways to get a better rate, in addition to choosing a shorter rate lock period. A larger down payment will result in a lower interest rate, because you'll have a good amount of equity from the beginning. You can pay points to lower your rate for the term of the loan, meaning you pay more up front. To many people, this makes financial sense..

Norcal Capital Group, Inc can walk you through the pitfalls of getting a mortgage. Give us a call at (650) 689-5684.

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