A mortgage Loan Estimate is a standard form that shows important details of a loan you have requested. Getting estimates from more than one lender can make differences easier to see.
Line up the same kind of loan
Make sure each estimate uses the same purchase price, down payment, loan amount, loan type, and rate-lock status. Then compare the interest rate, APR, estimated monthly payment, mortgage insurance if any, closing costs, and estimated cash needed to close. Check whether the payment includes taxes and insurance or whether those are separate expenses.
Look for tradeoffs
Discount points can mean more money due at closing in exchange for a lower rate. Lender credits can reduce upfront costs while increasing the rate. Compare both the near-term cash need and the cost over the time you expect to keep the loan. Ask the lender to explain any adjustable-rate terms or payment changes.
The estimate is not the final closing document. Review the later Closing Disclosure and ask about any difference you do not understand. Keep written copies of the offers you compare.
Further reading: CFPB guide to comparing Loan Estimates and CFPB Loan Estimate explainer.
This is general educational information for U.S. readers. Product terms and state rules vary. Check current documents and ask a qualified professional when you need personal advice.