A good mortgage rate can make or break your loan agreement. Prospective homebuyers have to be vigilant about finding a good rate, as they fluctuate regularly. A mortgage rate lock is a guarantee from lenders that the buyer can secure a consistent mortgage rate as long as the mortgage deal officially closes within an agreed upon time frame. Keep reading to get your finger on the pulse of the market and pounce when the time is right.
Closing a loan is more art than science. Once you get an estimated closing date from your lender, work backwards to determine the ideal window to lock in your preferred mortgage rate. You can generally lock in mortgage rates for a period of 30-90 days, so once you know how long it will take to close the details of the loan you can secure a comfortable mortgage rate that falls within that time frame.
It is important to keep in mind that longer lock periods will cost more money to reserve, and sometime lenders will leverage their risk by increasing the interest rate on longer locks. An optimum timing bracket is less than 60 days, but keep your options open by asking for the lock rates of different increments.
Knowing the ideal ballpark interest rate empowers prospective buyers to take action when the time comes. When an interest rate opens up within your bracket, you need to have the confidence to move forward with that number. Closing a mortgage deal can be very stressful for the buyer; there are a million details to keep in mind throughout this process of moving, financing, and resettling. Getting the mortgage rate lock squared away is one less thing on your plate.
Get more information about securing an optimum mortgage rate. Our team of mortgage experts at Midland Mortgage is here to help you today.