How to shop for and compare mortgage offers

Shopping for a mortgage is likely the most significant financial decision you will make. While it’s tempting to accept the first offer to simplify the process, failing to shop around could cost you tens of thousands of dollars over the life of your loan.

Research from the CFPB suggests that getting just one additional quote can save homebuyers an average of $1,500, while five quotes can save upward of $3,000. Here is how to strategically compare mortgage offers in 2026 to ensure you get the best deal.

How to Shop for a Mortgage

Step 1: Determine the Best Type of Mortgage Loan for You

Before you can compare offers, you need to be comparing “apples to apples.” Different loan products have different requirements and long-term costs.

Conventional Loans: Best for those with strong credit and at least 3% down.
FHA Loans: Popular for first-time buyers with lower credit scores or smaller down payments.
USDA Loans: Zero-down options for homes in eligible rural areas.
VA Loans: Exclusive zero-down benefits for veterans and service members.
Jumbo Loans: Necessary for high-priced properties that exceed conforming loan limits.

Pro Tip: Decide on your loan term (e.g., 15-year vs. 30-year) and rate type (Fixed vs. Adjustable) before requesting quotes. This ensures you are comparing the same financial structure across lenders.

Step 2: Gather the Necessary Documentation

To provide an accurate quote, a lender needs a clear picture of your financial health. Prepare a digital folder with the following:

Income: Recent pay stubs (30 days) and W-2 forms from the last two years.
Tax Returns: Last two years of individual and business tax returns (all schedules).
Assets: Two months of statements for checking, savings, and investment/retirement accounts.
Debts: Records for student loans, car loans, and personal credit lines.
Special Circumstances: Gift letters for down payment assistance, divorce decrees, or bankruptcy/foreclosure discharge papers.

Step 3: Compare Local Mortgage Offers Online

Verify that your chosen lender is established and highly rated. In the current market, it is vital to understand the difference between a mortgage broker and a direct mortgage lender.

While brokers act as intermediaries, direct lenders handle the entire process—underwriting, processing, and funding—in-house. This often results in:

Lower Overhead: Savings passed to you via lower rates.
Faster Closing: Direct communication between the loan officer and the underwriter.
Transparency: No hidden middleman fees built into the rate.

However, you should always weigh the pros and cons of staying with your current bank versus exploring new options. For a deeper dive into this choice, see our guide on shopping around vs. staying with your current mortgage lender.

What’s the Difference Between APR and Interest Rate?

This is the most common area of confusion for borrowers.

Interest Rate: The annual cost of the loan to the borrower, expressed as a percentage. This is used to calculate your monthly principal and interest payment.
APR (Annual Percentage Rate): A broader measure of the cost of your mortgage. It includes the interest rate plus other costs such as broker fees, closing costs, and discount points.

The CFPB requires lenders to disclose the APR to prevent hidden costs. If a lender offers a very low interest rate but a significantly higher APR, it usually means they are charging high upfront fees to “buy down” that rate.

Understanding the Loan Estimate

The Loan Estimate is a standardized three-page document you receive after applying. It is the most powerful tool you have for comparison.

What to Compare on Your Loan Estimates:

Interest Rate & Lock-in: Check if the rate is locked or “floating.” A floating rate can change before you close.
Prepayment Penalty: Ensure your loan doesn’t penalize you for paying it off early (most modern mortgages don’t).
Estimated Cash to Close: This is the actual amount of money you need to bring to the table.
Lender Fees (Box A): This is the most important section for comparison. These are the fees the lender controls. Compare Box A across all offers to see who is truly charging the least for the loan itself.

For a line-by-line breakdown, read our article on how to read and compare loan estimates.

How Many Quotes Should You Get?

The CFPB recommends at least three quotes. In 2026, with interest rates stabilizing in the 6% range, even a 0.25% difference can save you roughly $300 a year on a $200,000 mortgage—totaling $9,000 over 30 years.

To minimize the impact on your credit score, try to get all your quotes within a 45-day window. Credit bureaus treat multiple mortgage inquiries within this timeframe as a single “hard pull.”

Metropolitan Mortgage Can Provide Your Best Offer

If you are looking for mortgage financing in Overland Park or the greater Kansas City area, we are here to help. Metropolitan Mortgage has been a trusted direct lender since 1997, offering a wide range of mortgage programs in Kansas and Missouri.