"Rate Lock" and other Ways to Get a Lower Interest Rate

Lock It In

A rate "lock" or "commitment" is a lender's promise to set a certain interest rate and a certain number of points for you for a certain period of time while your application is processed. This keeps you from working through your entire application process and discovering at the end that your interest rate has risen higher.

Although there can be a choice of rate lock periods (from 15 to 60 days), the longer spans are generally more expensive. The lender can agree to freeze an interest rate and points for a longer span of time, such as 60 days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of fewer days.

Other Ways to Save on Interest

In addition to going with a shorter rate lock period, there are more ways you can get the lowest rate. The bigger the down payment, the lower the interest rate will be, because you will have more equity from the beginning. You may opt to 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 some is to pay points to bring the rate down over the life of the loan. You'll pay more up front, but you will save money in the long run.

Stepping Stone Mortgage can answer questions about rate lock periods and many others. Give us a call: (541) 683-3300.

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