Collect the written terms for each lender
- Written offers for the same amount and product type
- APR, term, payment and fee disclosures for each offer
- Rate-lock or quote-expiration details
- Prepayment and optional-product terms
Put every offer on the same footing
Enter each offer exactly as disclosed.
Set one holding horizon and compare cost through that month.
Compare matched terms before testing longer terms.
Challenge the offer with the smallest payment
A smaller payment requires a longer loan
Enter two written offers for the same principal, first exactly as quoted. If one uses a longer term, run a second comparison after matching the terms. Compare scheduled interest and entered fees with the monthly payment so the cash-flow benefit is not mistaken for a lower-cost loan.
Separate payment relief from borrowing cost
A lower payment may come from a longer term. Compare the cost through one realistic holding period and the full scheduled total before treating that payment as a saving.
How to Compare Loan Offers Before You Sign covers the controlling document terms and questions outside this result.
Costs outside this fixed-rate comparison
- Variable-rate changes
- Late or optional charges
- Taxes and opportunity cost
The loan comparison this board makes
Normalize up to three fixed-rate offers using the same principal assumptions.