Mortgages and financing, explained

Two loans with the same rate can cost very different amounts once points, fees, mortgage insurance and the loan type are counted. Understanding a handful of terms - APR, points, LTV, PMI - is enough to compare offers on equal terms.

Start with how much to put down and how to read a Loan Estimate, then move to choosing a loan type, deciding whether points pay off, locking a rate and managing the loan after closing.

Your learning path

Work through the steps in order, or choose a level to see only the steps for where you are.

  1. STEP 1Beginner

    Decide on a down payment

    It sets your loan size, your mortgage insurance and the cash you keep in reserve.

  2. STEP 2Beginner

    Compare the cost of offers

    APR and the Loan Estimate let you compare lenders on the same basis.

  3. STEP 3Intermediate

    Choose the loan type

    Fixed and adjustable loans trade certainty against a lower starting rate.

  4. STEP 4Intermediate

    Lower the rate - or not

    Points and buydowns pay off only if you keep the loan long enough.

  5. STEP 5Intermediate

    Lock the rate

    A lock protects you from rate rises while the loan is processed.

  6. STEP 6Advanced

    Manage the loan later

    Refinancing, recasting and home equity borrowing each fit different goals.

Important terminology

The terms you will meet on this path, from the essentials to the specialist vocabulary.

All mortgages terms in the glossary →

Featured guides

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Calculators for this path

Common questions

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Advanced resources

For when you want the full detail - formulas, methodology and professional measures.

Apply it to a property

Paid analyses that work through these steps for a specific address.

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