Getting a Low Interest Rate

Freezing the Rate

A rate "lock" or "commitment" is a lender's promise to lock in a particular interest rate and a particular number of points for you for a specified period while your application is processed. This means your interest rate can't grow during the application process.

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

Other Interest Saving Strategies

In addition to opting for the shorter lock period, there are other ways you may be able to score the lowest rate. A bigger down payment will get you a reduced interest rate, since you'll have a good deal of equity from the beginning. You could opt to 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 many people is to pay points to improve the interest rate over the life of the loan. You are paying more up front, but you'll save money in the end.

At America's Home Loans, we answer questions about this process every day. Call us: 701.222.0100.

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