What is a "rate lock period"?

Locking in your Interest Rate

When you're promised a "rate lock" from a lender, it means that you are guaranteed to get a specific interest rate for a determined period while you work on the application process. This ensures that your interest rate cannot go up while you are going through the application process.

Rate lock periods can be various lengths of time, between 15 to 60 days, with the longer ones typically costing more. You can get a longer period for your lock, but in making this choice, will probably have a higher rate than you would with a shorter rate lock period

Other Interest Saving Strategies

There are more ways to get a good rate, in addition to going with a shorter rate lock period. The bigger down payment you pay, the smaller the interest rate will be, because you will have more equity from the beginning. You can pay points to lower your rate for 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 rate over the life of the loan. You'll pay more up front, but you'll save money in the long run.

At Firelight Mortgage Consultants, we answer questions about this process every day. Call us: (303) 228-2254.

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