Low interest rates bring perfect time for a rate lock
Historically low interest rates are saving home buyers money – vital when facing high home prices. When shopping for a home loan, lenders will often give borrowers the opportunity to lock in an interest rate for certain period. Because mortgage rates can be volatile, picking the right day, when interest rates are at a low, can make a difference in monthly payments.
Most banks offer buyers a standard 30-days, (shorter lock terms are available) obligating the lender to offer the loan at the agreed upon rate if escrow closes during that time frame regardless of whether mortgage rates have changed. Consumers can be offered a lock period of 45, 60, or even 90 days but in exchange for higher closing costs or points.
Time for a rate lock
Although a rate lock sounds ironclad for buyers there are exceptions. Should a borrower’s credit score or income change significantly, the bank generally reserves the right to revoke the agreement. Additionally, buyers risk not being able to lower their interest should rates drop.
With rates near their lowest levels in nearly 10 months, experts advise those considering a purchase or refinance to act quickly. Conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent while 15-year rates are near 3.00 percent. Let’s get your loan locked in with amazing rates! Apply now here.
Do you have a question for Cory Baggs at Fidelity First Funding? Submit your queries about a home purchase or refinance over the phone at (801) 737-3533 or to: corybaggs@gmail.com and your questions may be featured in an upcoming article. We aim to make the process simple, pain-free and will explain every step of the process so you feel comfortable and know you are getting the best rates around. Cory Baggs and his team will take care of you and your family.