The early federal disclosure of proposed terms, payments, costs, payoffs, and estimated cash for a covered refinance.
A refinance Loan Estimate is the early federal disclosure of proposed terms, payments, costs, payoffs, and estimated cash for a covered refinance.
It is designed for comparison. It is not a loan approval, closing commitment, or promise that every estimated amount will remain unchanged.
A refinance offer cannot be evaluated from the interest rate alone. The Loan Estimate shows the proposed new loan amount and term, projected payment, origination and third-party charges, lender credits, prepaids, initial escrow amounts, and estimated cash to or from the borrower.
For most covered mortgages, the lender must deliver or mail the Loan Estimate no later than the third business day after receiving an application as defined by the federal rule. The lender cannot postpone that disclosure by requiring a fully documented underwriting package first.
The form also shows whether the interest rate is locked. An unlocked rate, points, and lender credits can change with market pricing. Even when locked, verified application changes can affect the final transaction under the lock terms.
The Loan Estimate follows the Refinance Application and arrives before closing. The borrower can use estimates from multiple lenders to compare offers on a consistent form.
After selecting an offer, the borrower communicates Intent to Proceed. That decision allows the lender to continue under the applicable fee and processing rules, but it does not waive the borrower’s ability to review updated terms or stop pursuing the loan.
A revised Loan Estimate may be permitted when a valid changed circumstance, borrower-requested change, rate lock, or another applicable event affects the disclosed terms. The most recent valid estimate should be compared with the Refinance Closing Disclosure.
| Form area | Refinance question |
|---|---|
| Loan terms | What amount, rate, term, payment features, or penalties are proposed? |
| Projected payments | How do principal, interest, mortgage insurance, and escrow change over time? |
| Loan Costs | What lender and required-service charges create the new loan? |
| Other Costs | What taxes, recording, prepaids, escrow deposits, and other items apply? |
| Lender credits | Is lower upfront cash being exchanged for different pricing? |
| Payoffs and payments | What existing mortgage or lien amounts are expected to be satisfied? |
| Cash to close | Must the borrower bring funds, or are proceeds expected? |
Refinance forms may use alternative cash-to-close tables that emphasize payoffs and payments rather than a purchase price and down payment.
Lender A offers a $300,000, 20-year refinance with a lower rate and $7,000 of closing costs. Lender B offers the same term with a slightly higher rate, $3,000 of costs, and a lender credit.
The borrower compares rate, APR, payment, points, lender credits, total costs, and estimated cash to close. The lower rate is not automatically the better offer if the borrower expects to sell or refinance again before recovering the extra upfront cost.
A refinance Loan Estimate differs from a rate quote. A quote may be informal and based on limited assumptions. The Loan Estimate is the standardized disclosure provided after an application for a covered transaction.
It differs from the Refinance Closing Disclosure. The Loan Estimate is early and includes estimates; the Closing Disclosure reports final or near-final terms and settlement figures.
It also differs from a Refinance Payoff Statement. The Loan Estimate may show an estimated payoff in the transaction calculation. The payoff statement comes from the existing loan’s servicer and provides the amount needed to retire that debt through a stated date.