Loan Estimate
The standardized three-page disclosure a lender must provide within three business days of a complete loan application.
The Loan Estimate (LE) is your earliest detailed look at what a loan will cost. Federally mandated and standardized across all lenders, it lays out the loan amount, rate, monthly payment, projected costs to close, and breakdown of fees in the same format every time, so you can compare lenders apples to apples.
Because the format is identical across lenders, the most useful comparison is the bottom-line cash to close and the total interest over the loan's life. Watch for differences in title fees, origination charges, and discount points, these are where lenders can differ significantly.
The LE is followed by the Closing Disclosure at the end of the process. By rule, costs can move only within tolerance limits between the two documents, and certain costs can't move at all unless circumstances genuinely change.
Related terms
Other terms you'll see alongside Loan Estimate
The five-page final-numbers document a lender must deliver to the borrower at least three business days before closing.
A blended figure that combines the note rate with most upfront loan costs to express the true yearly cost of borrowing.
The collection of fees and prepaid items, separate from the down payment, that a borrower pays at closing.
Prepaid interest paid at closing to permanently lower the loan's interest rate.
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