Page 3 of the Loan Estimate summarizes the terms of mortgage and interest rates. Understanding it helps you better manage your finances for a mortgage.
Loan Estimate Page 3 – Loan terms
Loan Comparison – See How Your Mortgage Really Works
The “In 5 Years” section shows how much you’ll pay during the first five years of your mortgage. This includes principal, interest rates, insurance, and other costs. The principal column helps you compare how much equity you gain through owning a home vs. renting.
Getting a mortgage helps you build equity over time, unlike renting, which provides no long-term financial gain, even if interest rates fluctuate.
APR & Total Interest Percentage – Understand Your True Borrowing Cost
APR is not your official interest rate, but it reflects the real cost of your mortgage (APR = interest rate + fees). The Total Interest Percentage shows how much total interest you’ll pay over the loan term. Knowing your total interest rate helps you decide whether to go with a 15, 20, or 30-year mortgage.
Other Critical Terms You CAN’T IGNORE on Your Loan Estimate
Appraisal – Property Valuation Fee
The appraisal is a required step when applying for a mortgage. It helps verify your home’s value and ensures your mortgage aligns with the property’s worth. You can request a copy of the appraisal report whether or not your mortgage is approved.
Loan Assumption – Can Someone Take Over Your Mortgage?
Loan assumption tells you whether your mortgage can be transferred to a new buyer. If allowed, the buyer keeps your original interest rate. If not, they must start a new mortgage at the current interest rates.
Homeowner’s Insurance – Can You Choose Your Own?
When getting a mortgage, you can select your own insurance provider. However, it must be approved by your lender and meet coverage requirements. This is an essential part of your mortgage documentation.
Late Payment Rules & Consequences
Paying your mortgage late (over 15 days) could trigger fees. More importantly, it can hurt your credit score. That could impact your ability to refinance or qualify for future mortgages. Missing payments may also cause you to lose a lower locked interest rate.
Late payments can hurt your credit score and reduce your ability to refinance in the future
Can You Refinance Anytime?
Not always. Even with good mortgage history, refinancing depends on your current income and credit. If your financials decline, you might not qualify.
Who Will Collect Your Monthly Payment?
Your lender may assign your mortgage to a third-party servicer. This affects who you send your payments to. Check the “Servicing” section to set up auto-pay correctly.
Confirming Your Loan Estimate Information
Before closing your mortgage, you must sign to confirm you’ve reviewed all terms. Double-check your name, loan amount, and especially your interest rate. This final step ensures your mortgage process moves forward without delays.
Conclusion
Page 3 of the Loan Estimate helps you understand your mortgage terms and interest rates in detail. Read carefully to avoid costly mistakes. Contact our team for expert advice to optimize your mortgage plan and lock in the best interest rates available!
Read more:
👉 Frequently Asked Questions For Selling, Buying, Investing And Mortgages: https://www.danguard.com/faq/
👉 Closing Cost Explained: What Are Closing Cost and How Much Are They? https://www.zillow.com/learn/closing-costs/
👉 Visit our Tiktok channel: Explore U.S. Housing Market Trends: Increasing Inventory and Prices Now https://www.tiktok.com/@victoriamaidang/video/7363628533316455711
👉 Warning: Top 3 Reasons Loan Applications Fail to Close at the Last Minute https://www.youtube.com/watch?v=8zPWgd8FE2M
👉 Conquer Los Angeles’s Market: Home Owning Now! https://www.facebook.com/share/p/1ZXGnAnD8g/
============
▶ Our Services:
– Real Estate Service: https://www.danguard.com/real-estate-service/
– Mortgage Service: https://www.danguard.com/mortgage-services/
– Real Estate & Mortgage Courses: https://www.danguard.com/courses/
– Contract Mortgage Processing: https://www.danguard.com/contract-processing/
– Financial Advice: https://www.danguard.com/financial-advice/
============
▶ Subscribe to our channel to never miss useful information:
– Newsletter: https://www.danguard.com/newsletter-eng/
– YouTube: http://www.youtube.com/@DanguardCo/?sub_confirmation=1
– Facebook: http://www.facebook.com/Danguard.DG
– X: https://twitter.com/SDanguard
============
▶ Contact Us:
– Live Chat Today: https://m.me/Danguard.DG/
– Email: support@danguard.com
– Website: https://www.danguard.com/
– LinkedIn: http://www.linkedin.com/company/danguard/
============
▶ License: DRE# 02186207 – NMLS# 2349003
