How to read a rate quote before you sign
Big lenders advertise a rate. The cost of that rate is in the fine print. Here's how to read a quote in five minutes, and what to send me if you want a second set of eyes.
I can assist with your home loan in 49 states, excluding New York.
Start with the points, not the rate
A discount point is a fee you pay up front to buy the rate down. One point is one percent of the loan amount. It isn't a rate, it's the cost of getting one.
The rates you see advertised on the big lender sites usually assume you're paying points. The number is real, but the price tag for it lives further down the page in the fine print.
So when you put two quotes next to each other, the rate by itself tells you almost nothing. Find the points on each one first. If they're different, you aren't comparing the same thing yet.
Find the APR and ask why it's higher
APR folds the lender's fees back into the rate, so it's a rough way to see what the loan costs you beyond the rate on the front page.
If the rate and the APR are close together, the fees are light. If there's a wide gap between them, there are fees in there doing the work.
That gap is your question. Ask the lender to list what's in it, line by line. It takes them about a minute to answer, and how they answer tells you something too.
Read the assumptions
Every quote is built on assumptions, usually in small print at the bottom: credit score, down payment, loan size, property type, and whether taxes and insurance are escrowed.
If your file doesn't match those assumptions, the quote isn't yours. It's somebody else's quote that you happened to read.
Go through them one at a time against your own situation. A credit tier you don't quite hit, or a property type that isn't what they assumed, changes the pricing you'd actually get.
Check the lock
Ask whether the rate is locked or floating. A floating quote is today's number, and it can move before you sign anything.
If it's locked, ask for how long, and put the expiration date on your calendar.
Then ask the one most people skip: what happens if closing slips past that date. Extensions usually cost something, and you want to know that before you need one.
What to send me
Send me the Loan Estimate if you have one. If you don't have one yet, a screenshot of the quote is fine, as long as the date is showing.
Add two things you already know: your credit tier and your down payment range, as you understand them. That's enough for me to line your file up against the assumptions the quote was built on.
I'll read it in plain language after reviewing your information. If it's a good deal, I'll say so.
Frequently asked questions
Is a lower rate always the better deal?
No. A lower rate usually costs more up front in points and fees, and a higher rate can come with a lender credit that covers some of your costs. Look at the rate, the points, and the fees together, then weigh that against how long you plan to keep the loan.
Can you beat a Rocket or bank quote?
Sometimes yes, sometimes no. I shop 160+ wholesale lenders, so I get to compare a lot of pricing, but nobody wins every file. I'll read your quote and tell you straight which way it goes.
Will comparing quotes hurt my credit?
Reading a quote takes no credit pull at all. And when you do apply in a few places, the scoring models treat mortgage inquiries made inside a short shopping window as one inquiry, so shopping around is not the thing that hurts you.
Send me the quote and I'll read it with you
Here's how the second opinion works. Text me what you have or book a short call, and you'll get a plain-language read after reviewing your information.