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Why do docs state that BGP for L3 Out require a reachable loopback?

I just set up an L3Out using BGP between an external router. I am using an SVI over VPC and everything works fine, including failover. In yet another confusing case of misleading documentation, Cisco says this:

Link to Original Page

"...Ensure that the route to leaf router ID is present in the routing table of the the Layer3 device either through static route or OSPF configuration. Also, when setting up the BGP neighbor on a Layer 3 device, the peer IP address that is used must be the router ID of the leaf switch."

I don't have a route to the router ID of the leaf switch on my external router. Why does it say I need this? I am not peering between loopbacks. If I was then the above would be true, but nowhere in that paragraph does it make that clear.

Furthermore, in table 2 of the same page it says I don't need a loopback for EBGP or IBGP direct connections...well duh. What is going on here?

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