Video — APR vs TIP Comparisons In Your Loan Estimate

The Loan Estimate form helps you compare different loans; Page 3 of the form summarizes the key figures.

Cost-over-time figures ("In ___ Years") chart out the total amount paid, and the amount applied against loan principal. This ratio usually changes over time.

Annual Percentage Rate - APR - gives you the ratio of interest PLUS any applicable fees for a complete percentage cost, per year.

Total Interest Percentage - TIP - shows interest over the life of the loan, in relation to the loan amount. For example, a $500K loan with a TIP of 20% indicates that you would pay $600K (20% of $500K = $100K) in total.