Save Now – Don’t Wait for Better Interest Rates!

Let’s talk about why waiting for better interest rates on a refi does not always work out with the results you may want. Even with rates at extremely low levels, many are wondering if it’s a good idea to wait and see if rates get lower before refinancing. Well, that’s a double-edged sword.

One of the things not often considered is the amount of money that could have been saved while playing that waiting game. Even if rates do improve in the future, the dollars that would have been saved during the waiting period may be significant. A few hundred dollars saved per month can add up to potentially thousands before a lower rate opportunity arises. It could also take a long time for the incremental savings of a lower rate in the future to make up for all the money that is lost waiting.

And remember, there’s no guarantee that rates are going to head even lower.

It’s important to weigh the individual options for you, and I’m here to help you do that. Another part of this is your credit score. What if your credit score decreases? Now the rate you could get today, you won’t be able to get three months from now due to a lower credit score. That happened with a recent client of mine and he missed out on a really great rate.

So call me! Let’s talk about your specific situation and see what’s going to make the most sense for you going forward! Thanks for spending a little bit of time with me today.

If you have questions, let me know.

What is a Rate Lock?

I’m kicking off a series of mortgage minutes detailing different parts of the loan or loan process. Today’s topic is rate locks. Rate locks are in reference to the interest rate on your mortgage. A rate lock, or locking your rate, uses the current day’s interest rate to secure your loan. That means your interest rate will not change based on market conditions. This protects you, the client from rising rates if the market shifts… and it has been shifting like crazy recently.

Rate locks can usually be done in increments of 15 days, running from 15 days to 360 days, depending on the loan type you are getting. Is it a purchase or refi construction, renovation and so on. The other thing here is at Movement we have a little bit of an unusual rate lock system. We allow clients to lock in smaller slices, so, instead of having a 15, 30, 45-day, so on, we do 37-day, 20-day, 17-day, etc. So you can take advantage of a better rate in a smaller slice.

One thing that happens when you lock your rate is, if rates go up, you are protected. And that’s actually great. You are not going to be subject to interest rate gyrations, as I said earlier. The other thing that happens is there are other instances that can change your interest rate and they are not market-related. If you do have questions on those, let me know.