How do I compare mortgage offers?
The best way to compare mortgage offers is to put Loan Estimates for comparable loans side by side and look beyond the interest rate. Compare the loan type and term, loan amount, rate, monthly principal and interest, mortgage insurance, estimated total monthly payment, upfront loan costs, points, lender credits and estimated cash to close.
Also consider how long you expect to keep the mortgage. The lowest rate is not automatically the lowest-cost or best mortgage for your situation.
Compare the same kind of mortgage
Compare the same loan amount, loan type, fixed or adjustable structure, term, down-payment assumptions, points or credits and rate-lock status.
Interest rate matters, but it is only one part
A lower rate may require points or other upfront cost. Confirm whether the quoted rate is locked or can change.
Look at more than principal and interest
Compare estimated total monthly payment, including applicable mortgage insurance, taxes, homeowners insurance and escrow. Differences in estimated taxes or insurance do not necessarily mean one lender offers a better deal.
Compare what each lender is charging
Compare lender-controlled costs such as origination, applicable application, processing and underwriting charges, points, certain services and credits. Not every estimated closing cost is controlled by the lender.
Are you paying points for the lower rate?
One point equals 1% of the loan amount. Compare the upfront cost with the potential benefit of a lower rate over the time you expect to keep the mortgage.
What are lender credits?
Credits can reduce upfront costs in exchange for a potentially higher rate. They are not free money.
How much money will you need at closing?
Review Estimated Cash to Close; it is not the same as the down payment alone.
Compare what the mortgage could cost over time
The Loan Estimate’s five-year comparison can help, but five years is a comparison tool—not the right timeframe for every borrower.
Should I compare APR?
Yes, as one measure. APR can help compare borrowing cost but does not capture the entire decision.
Check whether the loan can change
Review adjustable rates and payments, potentially increasing balances, prepayment penalties and balloon payments.
Does receiving a Loan Estimate mean I’m approved?
No. A Loan Estimate is not mortgage approval or denial; underwriting still applies.
Get Help Understanding the Full Mortgage Offer
A participating mortgage professional can help explain the rate, APR, points, credits, fees, payment and cash-to-close tradeoffs in the official offer.
A live connection is an attempt to reach an available participating professional, not a guarantee that someone will answer or that financing will be available.