How to compare mortgage lenders and Loan Estimates in Florida.

Mortgage pricing is not the same everywhere. Two lenders can look at the same borrower and the same home and come back with different rates and different fees. Freddie Mac research has found that borrowers who got just one additional quote saved about $1,500 on average over the life of the loan, and those who compared more quotes saved more.

Comparing takes some effort, but a few hours spent on side-by-side Loan Estimates is often one of the best-paid hours of the entire home purchase.

The Loan Estimate is a standard three-page federal form. Lenders must give it to you within three business days after you submit an application. Because every lender uses the same layout, you can lay two or three of them next to each other and compare line by line.

Page 1 summarizes the loan terms, projected payments, and estimated cash to close. Page 2 itemizes closing costs in lettered sections. Page 3 holds comparison figures such as APR and Total Interest Percentage. Getting a Loan Estimate does not commit you to that lender.

• Interest rate and APR. The rate drives your monthly payment. APR folds in certain lender costs, so it helps compare offers, but it is not a complete picture on its own.
• Points and lender credits. A lower rate can be bought with points, and a higher rate can earn a credit toward closing costs. Compare offers at similar point levels, or compare the total cost.
• Section A, origination charges. These are what the lender charges for making the loan, and they are the most directly comparable fees between lenders.
• Sections B and C, services. Section B lists services you cannot shop for and Section C lists services you can shop for, such as title. Third-party fees often vary less between lenders than lender fees, but check them anyway.
• Section D, total loan costs. This adds A, B, and C and gives a clean number for comparing lender-driven costs.
• Cash to close. This is your down payment plus closing costs, minus credits. It is the number that has to be in your account.
• Total Interest Percentage (TIP). Found on page 3, this shows the total interest you would pay over the loan term as a percentage of the loan amount.

For a rough sense of what the rest of closing costs look like, try the closing cost estimator.

Applying with several lenders does require credit inquiries. Credit scoring models generally treat multiple mortgage inquiries within a short period as a single inquiry, since they assume you are comparing offers for one loan. How long that period is depends on the scoring model, commonly anywhere from about 14 to 45 days.

The safest approach is to compress your shopping into about two weeks. Questions about how your score fits the loan you want are covered in our guide on credit scores for buying a home.

A rate lock holds a quoted rate and its related points or credits for a set period while your loan is processed. When comparing lenders, ask how long the lock lasts, whether there is a fee for it, what it costs to extend if closing slips, and whether you can get a lower rate if the market improves after you lock.

Make sure each lender is quoting the same lock period. A rate that looks better on a short lock may not be better than another lender's rate on a lock long enough to reach your closing date. For general background, see our page on mortgage rates.

• Are you quoting a conventional, FHA, VA, or other loan, and why is it the best fit for me?
• Is this rate quote for today, and is it locked or floating?
• How many discount points or lender credits are included in this rate?
• What is your rate lock period, what does it cost, and what happens if closing is delayed?
• Which fees on the Loan Estimate can change before closing, and which are fixed?
• Is there a prepayment penalty, or any fee if I pay the loan off early?
• Will my loan be serviced by you, or sold to another servicer?
• What is your typical time from contract to closing, and who is my point of contact?
• Which documents do you need from me, and how soon can underwriting begin?
• Do you have any local Florida programs or down payment assistance that I may qualify for?

• Quoting a rate with no written Loan Estimate, or refusing to put terms in writing.
• Pressure to lock or sign immediately, or claims that a quote expires today without explanation.
• A rate that looks far below every other quote, with points or fees buried elsewhere.
• Vague answers about fees, or fees that are not itemized on the Loan Estimate.
• Asking you to sign a blank or incomplete document.
• Promising approval before reviewing your income, assets, and credit.
• Adding a prepayment penalty or changing the loan product late in the process without a clear reason.

None of these alone proves a problem, but each is a good reason to slow down and ask for details in writing.

A loan officer at a mortgage lender or bank can offer that company's own loan programs. A mortgage broker is a middleman who can submit your file to several wholesale lenders, which can widen your options, though how they are paid varies. A credit union is member-owned and may offer competitive terms, but you typically need to qualify for membership.

No one channel is always cheapest, which is why comparing Loan Estimates from more than one type is useful. You can browse our lender directory to see options.

Copy the numbers from each Loan Estimate into the blank columns below. Have your documents ready so lenders can issue accurate estimates; the checklist is in documents needed for a mortgage.