How do I compare rates between lenders when trying to decide which one is offering the best deal? And what is APR?
Every lender is required to provide certain disclosures under federal law to allow you to understand (and ultimately shop) the economics of the mortgage proposal. Included in these are the Good Faith Estimate and Initial Truth-in-Lending Statements. You should carefully review these documents to fully understand all fees associated with the settlement charges. The annual percentage rate (APR) is what is most commonly used to compare lenders as the “note rate” can vary widely depending on what fees are being charged. The APR factors interest plus certain closing cost, any points and other finance charges over the term of a loan.
