: Your home might very well be the largest purchase you ever make, and it may even be your largest asset. You definitely don't want to take that lightly--shopping around is a smart move.
Two common terms that you will see while
comparison shopping are Note Rate and APR:
Note rate: The mortgage rate stated on a promissory note. It is also known as the Nominal Rate or Face Interest Rate. The Note Rate is what you see most prominently in ads-- it is often not labeled explicitly as such.
When in doubt... the advertised rate is the Note Rate
APR (Annual Percentage Rate): rate that takes into account the closing costs, finance charges, and note rate on a mortgage. A more complete and comprehensive measure of the cost of your mortgage loan.
The APR is the key to comparison shopping
As stated above, most mortgage loan advertisements or rate sheets heavily highlight the note rate. While the note rate is important, it's really not the whole picture...
Bottom Line:
When shopping for your mortgage, compare financial institution's quoted APR side-by-side for a true apples-to-apples comparison.
Do you have a mortgage-related question? Submit it here or email claire@mortgagefirstcorp.com
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