Getting a Low Interest Rate

Freezing the Rate

A rate "lock" or "commitment" is a lender's promise to hold a certain interest rate and a specific number of points for you for a certain period while your application is processed. This ensures that your interest rate won't get higher during the application process.

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

Other Interest Saving Strategies

There are more ways to get a better rate, in addition to going with a shorter rate lock period. A bigger down payment will result in a better interest rate, since you'll have more equity at the start. You could choose to pay points to bring down your rate over 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 initially, but you'll come out ahead, especially if you don't refinance early.

Milestone Mortgage, Inc. NMLS#136714 can answer questions about rate lock periods & many others. Give us a call at 3175959600.

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Milestone Mortgage, Inc. NMLS#136714

7168 Graham Road Suite 175
Indianapolis, IN 46250-2683