The Total Interest Percentage (TIP) is a disclosure that tells you how much interest you will pay over the life of your mortgage loan. It is calculated by adding up all of the scheduled interest payments, then dividing the total by the loan amount to get a percentage. The calculation assumes that you will make all your payments as scheduled and keep the loan for the entire loan term. The TIP tells you how much interest you will pay over the life of your mortgage loan, compared to the amount you borrowed. The TIP is not the same as your interest rate, and it is not the same as the annual percentage rate (APR) . The TIP will usually be much larger than either the interest rate or the APR because it is based on the total interest you would pay over the full term of the loan. If your Loan Estimate is for an adjustable-rate mortgage (ARM), the TIP is calculated using current interest rates, and the actual amount you pay could be more or less, depending on how rates change in the future.