Good Faith Estimate Tip

Here’s a good tip for you on the Good Faith Estimate.  Knowledge is Power! 

If you recall, several years ago U.S. Congress tried to protect consumers from a few unscrupulous lenders by requiring all lenders to calculate and disclose the annual percentage rate (APR) you pay on your mortgage loan.  But most homebuyers will learn more by concentrating their attention to the Good Faith Estimate of Settlement Costs (GFE).  Although Congress meant well, the APR is not helpful and may be confusing.

If you are looking for a good way to understand your costs of borrowing and/or to compare one lender’s costs to another, the Good Faith Estimate is your best bet.

Get your lender to provide a written Good Faith Estimate before you commit your mortgage business. When reviewing a Good Faith Estimate, keep in mind that the lender actually controls only a certain portion of the disclosed costs.  Other parties typically control the cost of appraisal, settlement, title insurance, recording fees and taxes, survey, and the “prepaid” expenses of homeowner’s insurance, mortgage insurance, real estate taxes, etc.

Review these origination fees, discount points, etc. and you will have the ability to understand the full costs of your proposed mortgage loan.

If you have any questions about this tip, please ask! 

 I’ll get back to you quickly.

About The Author

Jolie Powell

Jolie Powell has been a distinguised leader in the Real Estate industry since 1987. Prior to entering the world of Real Estate, she worked as a TV producer for the Advertising Agency, Dancer Fitzgerald Sample in NYC. Jolie's expertise in counseling buyers and sellers brings people together from Long Island, and indeed, Globally! Having lived abroad and traveled extensively, Jolie has an excellent understanding of many cultures. As a Cuban-born American, she is fluent in Spanish and communicates well with international clients relocating to the North Shore of Long Island. Jolie is proud of the high level of trust she and her clients have established and looks forward to continue building exceptional client/broker relationships.