APR exists to solve exactly the problem you have: three lenders quoting different rates with different fees, and no obvious way to line them up. It does solve it — on one assumption that almost nobody satisfies. APR spreads the upfront costs across the full term, so it answers the question "which is...
RATE %
TERM
POINTS
FEES $
Take every figure from the loan estimate, not the advertised rate. Points are a percentage of the loan; fees are origination, underwriting and anything else the lender charges to make the loan. Leave out appraisal, title and taxes — you pay those whichever offer you take, so they cannot change the ranking.
CHEAPEST IF YOU LEAVE AT 7Y
Offer A
$571,507 of total cash out, which is $4,019 less than Offer B. APR agrees with this, so the choice is robust either way.
PAYMENT
$2,398.20
UPFRONT
$11,500
APR
6.274%
| Payment | Upfront | APR | At 7y | |
|---|---|---|---|---|
| A | $2,398.20 | $11,500 | 6.274% | $571,507 |
| B | $2,495.48 | $5,000 | 6.495% | $575,526 |
| C | $2,627.72 | $0 | 6.875% | $584,603 |
This is an estimate, not financial advice. It compares principal, interest and lender fees only. Mortgage insurance, escrow, rate locks and prepayment terms can all move the answer and none are modelled here. Rate quotes also expire — a comparison built on last week's numbers is a comparison of nothing.
THE COMPARISON
The line on the baseline is the one winning. Each curve shows what that offer would cost you above the cheapest available at that month, so the winner sits at zero and a crossing is one line rising off the baseline as another drops onto it. Plotted as absolute totals these three would be indistinguishable — they differ by tens of thousands against totals near a million.
Live calculation · updates as you type
Take every figure from the loan estimate rather than the advertised rate. A headline rate frequently assumes you are buying points, which makes it look better than a competitor quoting honestly.
Enter points and lender fees separately. Points are a percentage of the loan; fees are origination, underwriting and anything else charged to make the loan happen.
Leave out appraisal, title and taxes. You pay those whichever offer you take, so including them adds noise without changing the ranking.
Set the years you expect to keep the loan honestly, not optimistically. If the winner changes across the plausible range, that uncertainty is the real finding.
| If you leave at | Offer A | Offer B | Offer C | Cheapest |
|---|---|---|---|---|
| 2 years | $458,930 | $455,435 | $454,446 | C |
| 3 years | $482,172 | $480,182 | $481,204 | B |
| 5 years | $527,610 | $528,630 | $533,682 | A |
| 7 years | $571,507 | $575,526 | $584,603 | A |
| 10 years | $634,027 | $642,492 | $657,559 | A |
| 15 years | $727,372 | $742,931 | $767,624 | A |
| 20 years | $803,083 | $824,924 | $858,228 | A |
| 30 years | $874,853 | $903,373 | $945,977 | A |
Read down the last column. If it changes, your holding period is doing more work than the rate is — and the honest answer to "which offer is best" is that it depends on a number only you can estimate.
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Last updated: July 31, 2026 · Formula verified · Eagle-eyed accuracy for every calculation.