Stage 3 of 6
Shopping smart
Rate versus APR, points, reading a Loan Estimate, comparing lenders and locking your rate.
Start with lesson 18 lessons, about 16 minutes in all. Last reviewed October 2026.
Lessons
- Getting pre-approvedA mortgage pre-approval means a lender has checked your credit, income and assets. It backs your offer, but it is not a loan commitment.
- Rate vs APRInterest rate and APR measure different things. The rate sets your payment; the APR adds points, fees and mortgage insurance as a yearly cost.
- Points and the break-evenMortgage points are prepaid interest that lower your rate. They pay off only if you keep the loan past the break-even month.
- Reading a Loan EstimateThe Loan Estimate is the same three-page form at every lender. Check the loan type, term, amount and rate lock first, then the costs on page 2.
- Comparing lenders the right wayTo compare mortgage lenders fairly, get Loan Estimates on the same day for the same loan at the same rate, then compare Sections A, B and C on page 2.
- Locking your rateA rate lock holds your rate until a set date. Nobody can time the market, so the right lock is the shortest one that safely covers your closing.
- Reading your Mortgage PlanYour Mortgage Plan shows each loan option as a card with its payment and cash to close. Tags state facts, and every Breakdown adds up exactly.
- Cost over timeThe lowest payment is not always the lowest total cost. Add up closing costs, interest and mortgage insurance for the years you will keep the loan.