After you apply for a mortgage, you will receive the most important document in the loan process—the Loan Estimate.
The Loan Estimate is a three-page form covering important information regarding your potential loan. This form will give you an estimated interest rate, monthly payment, closing costs and more!
This estimate does not necessarily mean that the lender has approved your loan application, so don’t get too excited! The lender will provide the loan estimate in order to show the terms they may be able to offer you if you decide to move forward. Once you accept, you will then need to provide additional financial documents in order to get a full approval.
You will want to make sure to review all the information on your loan estimate carefully and make sure it matches what you have previously discussed with your loan officer.
How much are you borrowing?
Check out the loan amount and make sure it accurately reflects what was discussed with your loan officer.
What is your interest rate?
Is it the rate you were expecting? If not, give your loan officer a call.
What is your monthly payment, how much are your closing costs?
Make sure these payments and fees match your expectations before moving forward.
Is everything spelled correctly?
It may seem simple but even a minor misspelling can cause major issues later on. Check your name carefully, as well as all of your loan officer’s information. Keep in mind, loan officers are required to be licensed with the Nationwide Mortgage Licensing System & Registry. You can look up Loan Officer’s credentials in the NMLS database.
Below is an example of a loan estimate with the details that you should look for in yellow. Click the image to open the pdf.
By Meagan Rochard