New Good Faith Estimate

December 31, 2009 | Leave a Comment

The federal government has finally simplified the Good Faith Estimate. In 2010 consumers will get to decide whether the government was successful or not. Starting January 1, 2010, lenders will be required to use HUD’s new 3-page Good Faith Estimate. It used simplified language and requires lenders to state the loan amount up front, loan term, interest rate, and monthly payment. HUD is also intending to protect borrowers from big surprises at the closing table. The department revised its HUD-1, so comparisons between the Good Faith Estimate and the final charges are also supposed to be easier to discern. In fact, HUD has imposed strict limits on how much the Good Faith figures can change. Some charges, like the origination fee, can’t change at all.



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