A Loan Estimate, also known as a LE, is a document that lenders must provide to borrowers within three business days of receiving a mortgage application or after certain key changes to loan terms. The LE provides borrowers with important information about the loan, including the interest rate, monthly payment, closing costs, and other fees. The LE is a standardized form that is required by the Consumer Financial Protection Bureau (CFPB).
On page 1—
Context: Identifying the document.
Loan Estimate header
Key takeaways: Important information.
Applicants' names, property address for the house being purchased or refinanced, and sales price
Loan term, purpose, product, and loan type
Loan amount
Interest rate
Monthly principal and interest from the proposed mortgage payment
Estimated property taxes, homeowner insurance, and homeowner associate assessments from the proposed mortgage payment
Estimated closing costs/fees
On page 2—
Key takeaways: Important information.
Origination charges – Lender fees
Services you cannot shop for – Fees for services with a designated vendor
Services you can shop for – Fees for services when the borrower selected the provider
Taxes and other government fees – Recording fees and transfer taxes
Prepaids – Fees/charges paid in advance like interest, property taxes, insurance
Initial escrow payment at closing – Money collected in advance to pay for future payments due for property taxes and insurance
Other fees
Notes on this document:
The fees from the LE are generated from the 2015 Itemization form in Encompass.
A LE must be provided by lenders to borrowers within three business days of receiving a mortgage application and within three business days of a Change of Circumstance.