Definition
A Loan Estimate is a standardized form that provides an estimate of the key terms and costs of a mortgage. It details your interest rate, monthly payment, and all closing costs.
Understanding the Loan Estimate
The Loan Estimate is given to you shortly after you apply for a mortgage. It outlines key details about your potential loan, including the estimated interest rate, monthly payment, and closing costs. Think of it as a preview of what your mortgage might look like. Example: If you're considering a $200,000 loan, the Loan Estimate might show an interest rate of 3.5% and estimated monthly payments of $900. It's not a guarantee of final terms, but a helpful tool to compare different loan options. It's not the same as a final loan offer, so details can change before closing.
