A Good Faith Estimate (GFE) is
an important yet sometimes confusing mortgage document that potential homeowners
and those refinancing their homes may encounter. A GFE could also be one of the
most powerful negotiating tools for you to land the best deal on a mortgage
loan. This document helps ensure borrowers end up with the same terms they were
quoted at the closing table. In this blog I discuss what a Good Faith Estimate
is and how you can use it.
A Good Faith
Estimate is the estimated closing costs associated with taking out a mortgage
loan to buy or refinance a home based on your personal information. Included in
the GFE is a summary of your anticipated loan terms, an itemized list of all
the various costs involved with financing, and how much money you will need to
bring with you to closing. In the past, lenders provided potential borrowers
with Good Faith Estimates, however, there have been many changes in the way
these are used and provided to clients.
We will need
some information from you so be prepared when you come in, call, or apply
online to fill out a loan application. Here is a list of what we will need from
you to give you a good faith estimate:
·
Your name
·
Your monthly income
·
Your social security number (to obtain a
credit report)
·
The desired property address
·
Estimate value of the property
·
Loan amount
·
Other items necessary and relative to the
loan
The Good Faith
Estimate is provided to potential homeowners to help them avoid overpaying for
a loan and sets forth the expected interest rate. Loan charges, third-party
fees, and other costs associated with the loan must be displayed uniformly. In
the past, lenders
weren’t always uniform in their estimations of fees included on the Good Faith
Estimate and how such fees should be disclosed. Sometimes sellers agree to pay
all or some of the buyer's closing costs, but when they don’t a GFE comes in
very handy to maintain the expected expense of purchasing a home.
At
Intercoastal Mortgage Company we provide our clients with an accurate Good
Faith Estimate and the most professional service a lender can provide. Contact meand begin the loan process to own your own home.