Buying a home in Albuquerque is a great opportunity at the moment, with mortgage rates lowest in several years. In addition to lower monthly payments, a lower interest rate also means that more people can qualify to buy a home. When you apply for a loan, the current interest rate is locked into your loan. But what happens if the rate falls further once it is locked in? What are the chances of getting the lower rate?

Lenders take rate locks seriously. You are reserving a rate when you lock it in with your lender. If rates rise before your closing date, you are protected. Most lock periods are between 15 - 30 days in length. It is crucial that the lock period last as long as the duration of your transaction. 

The lock protects you in case the rate increases. But what if the rate decreases during that time? Would you be able to get the lower rate?

Even if rates fall just a little, such as by less than 0.125%, it won't make much difference to change the rate in your agreement, nor will your lender be very motivated to make the change. Your lender might agree to lower your rate if it decreases by more than 0.25%. 

Changing lenders to get a lower rate is not a problem in advance of the closing date. This will allow you to have a lower rate. However, you also have to submit all your documents all over again to a new lender, including paystubs, tax returns, and bank statements. 

Your lender should consider lowering your agreed rate if rates fall by more than 0.25%. For a lender, it's better to do so than lose your business. Since both of you have worked hard to make the deal work, it benefits both of you.

Also, don't expect to get the absolute lowest rate when you make the request. There may also be a small fee to make the change. In the end, do the math and decide if requesting a lower rate works out for the best. It never hurts to ask!

Contact us today to help you buy or sell your next home in Albuquerque. Looking for the perfect home for sale in Albuquerque? Our easy-to-use home search tool can help you start the process. Join us twice a week on our blog for more real estate advice and great reasons to buy a home in Albuquerque and the surrounding area. Follow us on Facebook for the latest Albuquerque real estate updates.

 

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