How to read a mortgage rate sheet

If a lender sent you pricing and you are searching for how to read it, the first thing worth knowing is that "rate sheet" is probably not the document's real name. Three very different documents get called a rate sheet, and which one you are holding changes what it can tell you.

The three documents that get called a rate sheet

1. An actual rate sheet

This is the internal pricing grid loan officers work from: rows of interest rates with numbers like 99.875 and 100.250 next to them, columns of adjustments, usually dated and stamped with a time. It is the lender's menu, not your price. Borrowers rarely receive one, and if you have one, it cannot tell you what your loan costs. It shows what the lender could offer across every scenario, before anyone applies your credit score, your down payment, or your property to it.

2. A fee worksheet

Lenders send these before you apply, under names like loan estimate worksheet, closing cost worksheet, or just a quote. It can look official, but there is no required format and the numbers are an illustration. Nothing on a fee worksheet is binding. It exists so you can see a ballpark before the lender is allowed to send you the real form.

3. A Loan Estimate

This is the document with legal weight: a standardized three page federal form every lender must send within three business days of your application. It always has the words Loan Estimate at the top of page 1, and it looks the same from every lender on purpose, so offers can be compared line by line. Federal rules limit how much some of its numbers can rise before closing.

How to tell which one you have

Look at the top of the first page. If it says Loan Estimate and runs three pages in a fixed layout, it is a Loan Estimate. If it is rows of rates and decimal pricing with no borrower name on it, it is a true rate sheet. If it is anything else, one page with your name, an interest rate, and a list of estimated fees in the lender's own format, it is a fee worksheet.

How to read each one

A true rate sheet: read the date and time stamp first. Wholesale pricing moves daily, sometimes intraday, so a rate sheet is stale quickly. The rate column shows available rates; the price columns show what each rate costs or credits. Without a loan officer applying your scenario's adjustments, treat it as background, not an offer.

A fee worksheet: read it as a preview. Check the interest rate, the total estimated closing costs, and whether points are included, then ask the lender which numbers they will stand behind on a Loan Estimate. The gap between a worksheet and the Loan Estimate that follows is worth watching.

A Loan Estimate: this is the document worth reading closely, and we keep a full guide to it: How to read a Loan Estimate and a line by line lookup: The Loan Estimate, line by line. Page 1 is the offer, page 2 is the costs, page 3 is the comparisons.

If all you have is a worksheet, ask for the Loan Estimate

Once you have applied, the Loan Estimate is not a favor, it is required. Six pieces of information trigger it: your name, income, Social Security number, the property address, an estimate of its value, and the loan amount you want. If you have given a lender those six things, a Loan Estimate must be on its way within three business days. If you have not applied yet, a worksheet is the most a lender can honestly give you.

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