What is a "rate lock period"?

Lock It In

A rate "lock" or "commitment" is a lender's promise to freeze a particular interest rate and a certain number of points for you for a certain period of time during your application process. This ensures that your interest rate will not go up during the application process.

Although there are various lengths of rate lock periods (from 15 to 60 days), the longer ones are usually more expensive. You can get a longer period for your lock, but in doing so, will likely have a higher interest rate than you would have with a shorter rate lock period

Other Interest Saving Strategies

There are more ways to get a better rate, besides going with a shorter rate lock period. The bigger down payment you can pay, the lower your rate will be, as you will have more equity from the start. You can pay points to bring down your interest 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'll pay more up front, but you will save money, especially if you don't refinance early.

Hawk Mortgage Group can walk you through the pitfalls of getting a mortgage. Give us a call at (443) 619-7900.

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