Loan Estimate
The Loan Estimate is a standardized three-page document your lender must provide within 3 business days of receiving your mortgage application. It shows the loan amount, interest rate, projected monthly payment, and estimated closing costs. Use it to compare offers from multiple lenders — the format is identical across all lenders, making side-by-side comparison easy. Whether you apply through a direct lender or a broker, you are entitled to the same standardized Loan Estimate, which makes it straightforward to compare the true cost of each offer.
The Loan Estimate replaced the old Good Faith Estimate (GFE) in October 2015 under TRID rules. It's organized into clear sections: loan terms (rate, type, special features), projected monthly payments, closing costs broken into loan costs and other costs, a cash-to-close estimate, and comparisons showing 5-year costs across lenders.
When comparing Loan Estimates, focus on: the interest rate and APR, origination charges (Section A — these are the lender's fees), and total cash to close. Some lenders quote low rates but high origination fees; others charge points to buy down the rate. The LE makes these tradeoffs visible. Get LEs from at least 2–3 lenders on the same day (rates change daily) to make a valid comparison.
You have until 3 business days before closing to review changes between your original LE and the final Closing Disclosure. Certain fees (lender charges, transfer taxes) cannot increase at all; third-party fees you didn't choose can only increase up to 10% in aggregate. If fees changed significantly without your consent, contact the CFPB.
Key Takeaway
The Loan Estimate is a standardized three-page document your lender must provide within 3 business days of receiving your mortgage application. It shows the loan amount, interest rate, projected monthly payment, and estimated closing costs. Use it to compare offers from multiple lenders — the format is identical across all lenders, making side-by-side comparison easy. Whether you apply through a direct lender or a broker, you are entitled to the same standardized Loan Estimate, which makes it straightforward to compare the true cost of each offer.
Related Terms
Frequently Asked Questions
Within 3 business days of submitting a complete mortgage application. You must provide: name, income, Social Security number, property address, estimated value, and loan amount.
No. It's an estimate. The rate isn't locked until you formally lock it. Costs can change within legal limits between the LE and the final Closing Disclosure.
Compare Section A (origination charges), the interest rate, APR, and total cash to close. Request estimates on the same day since rates change daily.
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