Getting a Low Interest Rate

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Locking in your Interest Rate

When you're promised a "rate lock" from a lender, it means that you are guaranteed to keep a specific interest rate for a determined period for your application process. This saves you from going through your whole application process and discovering at the end that your interest rate has gotten higher.

Although there are several lengths of rate lock periods (from 15 to 60 days), the longer ones are typically more expensive. A lender may agree to lock in an interest rate and points for a longer period, say sixty days, but in exchange, the rate (and sometimes points) will be higher than with a rate lock of fewer days.

Other Ways to Save on Interest

There are other ways to get a low rate, besides opting for a shorter rate lock period. A bigger down payment will give you a reduced interest rate, because you'll have more equity at the start. You might opt to pay points to reduce your interest rate over the loan term, meaning you pay more initially. For many people, this is a good option..

At South Coast Funding, we answer questions about this process every day. Give us a call at 949-367-1317.