A Good Faith Estimate is a lender disclosure that outlines your mortgage terms and settlement charges, required by RESPA within three days of applying. Since October 3, 2015, it’s been replaced by the Loan Estimate. It includes the loan, interest rate and mortgage insurance, but not homeowner’s insurance or property taxes.
Buying a home? With the Beycome buyer program, you pay no upfront fee and can get up to 2% of the price back at closing.
Buying in Florida? You can get pre-approved with Beycome Mortgage (NMLS #2523620). It’s an affiliate of Beycome, and you’re not required to use it.
Within just three days of applying for a loan, you will get a document called a Good Faith Estimate (GFE). These pages outline the terms of the mortgage and the settlement charges. Put into place by the Real Estate Settlement Procedures Act (RESPA), lenders must issue a Good Faith Estimate by law. If you applied for a mortgage before Oct. 3, 2015, you received a Good Faith Estimate. If you applied on or after that date, you will get a new form entitled the Loan Estimate. Different name, same type of disclosure. They prevent lenders from taking advantage of prospective homeowners with excessive fees, and they allow individuals to make more informed choices when shopping for a mortgage. A mortgage is made up of the principal loan, interest rate, mortgage insurance (if this applies), homeowners insurance, and property taxes. A Good Faith Estimate will include the first three, but not the homeowner’s insurance or property taxes. Be sure to factor these into your finances when making a final decision.Common fees you will see on a GFE:
- Loan processing fees
- Interest rate
- Government fees
- Third party fees (such as attorney fees and title companies)
- Closing costs