Rate Shopping Playbook
Three Loan Estimates inside 14 days. Compare on APR and Section A. Stop reading advertised rates.
Most rate shopping advice is bad. Sites tell you to compare advertised rates. Advertised rates assume excellent credit, large down payment, owner-occupied primary residence, no cash-out, and discount points already paid into the price. Your actual quoted rate will be different. The Loan Estimate is the only number that matters.
Step 1. Pull a list of three lenders
Mix the types. One large bank or credit union. One mortgage broker. One direct lender or correspondent. They have different cost structures and different incentives, which means real spread in pricing.
Avoid lead-generation portals that send your contact to ten companies in one click. You will get calls every 30 minutes for two weeks. Apply directly with the three lenders you chose.
Step 2. Apply with all three inside 14 days
Submit a full application with each so they have to issue an actual Loan Estimate within 3 business days. The 14-day window matters because all credit inquiries inside that window count as one for credit scoring. Outside the window, each pull dings you separately.
Step 3. Stack the three Loan Estimates side by side
Same loan amount. Same down payment. Same property type. Same rate lock duration if locked. Now compare three numbers in this order:
- APR (page 3 of LE). Captures rate plus most fees in one number.
- Section A total (page 2). Pure lender margin.
- Cash to close (page 1). What you actually wire.
Step 4. Negotiate
Take the lowest APR LE to the second-lowest lender. Ask: can you match or beat. Most will move. This is the only step that consistently saves real money. Lenders price competitively only when they know they are competing.
Frequently asked
Advertised rates assume the best possible borrower. Highest credit tier. Largest down payment. Discount points already paid. Owner-occupied primary residence. The fine print on every advertised rate spells out the assumptions. Your real quote depends on your real numbers.
No. A lower rate paired with high Section A fees can be more expensive than a higher rate with low fees. Use APR as the first filter, then look at cash to close. Then check Section A to make sure you are not paying for the rate twice.
On a $400,000 30-year loan, the spread between the best and worst Loan Estimate from three random lenders is typically 0.25 to 0.50 percent on rate plus $1,000 to $3,000 in fees. Total lifetime savings: $20,000 to $50,000.