"Rate Lock" and other Ways to Get a Lower Interest Rate
Locking It In
When you're offered a "rate lock" from your lender, it means that you are guaranteed to get a set interest rate for a certain number of days while you work on your application process. This keeps you from getting through your whole application process and finding out at the end that the interest rate has risen higher.
Rate lock periods can be various lengths of time, anywhere from fifteen to sixty days, with the longer spans usually 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 larger the down payment, the smaller the rate will be, because you will be starting with more equity. You can pay points to reduce 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 are paying more up front, but you will save money, especially if you keep the loan for a long time.