Getting a Low Interest Rate

Lock It In

When you're offered a "rate lock" from your lender, it means that you are guaranteed to get a particular interest rate over a certain number of days while you work on your application process. This ensures that your interest rate can't go up during the application process.

Rate lock periods can be various lengths of time, anywhere from fifteen to sixty days, with the longer ones generally costing more. A lending institution can agree to hold an interest rate and points for a longer span of time, such as 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 lower rate, besides opting for a shorter rate lock period. A larger down payment will result in a lower interest rate, since you will have a good deal of equity at the start. You can pay points to lower your rate for the term of the loan, meaning you pay more up front. One strategy that makes financial sense for some is to pay points to bring the rate down over the life of the loan. You pay more up front, but you will save money, especially if you keep the loan for the full term.

Baywide Funding Corporation can answer questions about rate lock periods & many others. Give us a call: 650 428 0234.