When you apply for a mortgage and provide the 6 required pieces of information, a lender must provide a Loan Estimate within 3 business days if the loan is approved. This video explains the basics.
The Loan Estimate is a standard form, with required information. Yours will include:
- Loan terms, including interest and loan schedule
- Projected payments
- Costs at closing, including:
- Total Interest Percentage
- APR (Annual Percentage Rate)
- Estimates of costs from lender-recommended providers (“Can’t Shop”). Final costs must be in defined limits of these estimates.
- Estimates of costs that you can shop; these will vary based on your decisions.
Be clear that the Loan Estimate is an estimate – not a final, binding contract for loan costs and terms. It will give you a ballpark understanding about this loan, and some limits on the possible changes in final costs.
For more assistance (and additional videos) on the specific parts and pages of a Loan Estimate, search “Loan Estimate” on this site.