Loan Documents

Loan Estimate

A Loan Estimate is a three-page form your lender must send within three business days of your application. It lays out your estimated interest rate, monthly payment, closing costs, and cash to close in a standard layout, so you can compare offers from different lenders side by side. It's an estimate, not a final bill.

The Loan Estimate uses the same format at every lender, on purpose. That’s what makes it powerful: you can put two of them next to each other and compare the same boxes, line for line, instead of trying to decode different sales sheets. The Consumer Financial Protection Bureau designed it that way so shopping is fair.

Page 1 shows your loan terms and monthly payment, page 2 breaks down every closing cost, and page 3 has comparison numbers like APR and total interest. When you get yours, I’ll walk through it with you box by box, so nothing is a surprise at closing.

Related terms

Closing Disclosure

A Closing Disclosure is the five-page form that spells out your final loan terms and costs. Your lender must give it to you at least three business days before you close, so you can check it against your Loan Estimate and make sure the numbers didn't drift. Those three days are your built-in time to review.

Closing Costs

Closing costs are the fees you pay to finalize your home purchase, on top of your down payment. They include lender fees, title and escrow charges, an appraisal, and prepaid items like taxes and insurance. Closing costs commonly run roughly 2% to 5% of the purchase price, though it varies by location and loan.

Cash to Close

Cash to close is the total amount of money you need to bring to the closing table. It rolls together your down payment and closing costs, then subtracts things already paid or credited to you, like your earnest money deposit and any seller credits. It's the real out-of-pocket number for closing day.

Last updated: June 13, 2026

This definition is educational and isn't an offer to lend or financial advice. Rates, programs, and guidelines may change without notice. All loans are subject to credit and property approval.

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