In January 2000, John Rocker, a former relief pitcher for the Atlanta Braves, made controversial remarks to Sports Illustrated. Since that time, he has littered his career with one unpopular slur after another. His comments ignited a firestorm of debate concerning freedom of speech in America that continues to this day. Rocker's most well-known remarks from the Sports Illustrated interview are:
[New York is] the most hectic, nerve-racking city. Imagine having to take the [Number] 7 train to the ballpark, looking like you're [riding through] Beirut next to some kid with purple hair next to some queer with AIDS right next to some dude who just got out of jail for the fourth time right next to some 20-year-old mom with four kids. It's depressing. (Pearlman par. 5)
Since 1791, there has been a continuous dialogue in this nation regarding the rights the U.S. Constitution provides its citizens, and, more specifically, to what degree free speech is afforded them. Although Rocker's remarks are laced with bigotry and hatred, is he open to make those remarks without consequence? And, if his statements are considered protected speech, should he exercise that right liberally and without restraint? Does this great right carry with it even greater responsibility?
While I have a cursory knowledge of the legal system, it is still easy to see there are many conflicting views regarding freedom of speech. Cornell University Law School offers this commentary:
Probably no other provision of the Constitution has given rise to so many different views with respect to its underlying philosophical foundations, and hence proper interpretive framework, as has the guarantee of freedom of expression-the free speech and free press clauses. (par.5)
The idea goes further to show that there are several schools of thought concerning free speech. Some believe that there should be limitations on free speech based on a complex of values or limited only to political speech. Another school of thought, considered a broader-grounded view, argues that liberal freedom of speech promotes liberty, the concept of self-realization, and individual self-fulfillment (Cornell University Law School par. 5). Another quote from Cornell University Law School states, "...the writings of Milton and Mill [argue] that protecting speech, even speech in error, is necessary to the eventual ascertainment of the truth..." (par. 5). From a legal perspective, I agree with the broader-based view. The Constitution has given citizens, even Rocker, a liberal amount of protected speech, no matter how unpopular.
Although I believe that Rocker has the legal right to say almost anything without recourse from the government, I do not believe Rocker, or anyone else, is protected by the Constitution from the consequences of exercising that free speech. Indeed, I believe that the Constitution only limits federal powers when regulating speech but does not limit the actions other can take in response to that free speech, such as individual or corporations. The Constitution states "Congress shall make no law... abridging the freedom of speech..." (U.S. Const. amend I). It does not limit Joe Citizen, the Atlanta Braves, the media, Major League Baseball, or anyone else.
Although the Constitution restricts congressional actions that curb free speech, and while there is no federal mandate for personal responsibility when using free speech, the American society has responded to fill the void. In response to Rocker's remarks and in true American fashion the nation reacted. Relentlessly, media pundits made Rocker a villain by chastising him publicly and putting a spotlight on his litany of unpopular comments. Also in 2006, Rocker was banned from baseball by MLB commissioner Bud Selig, who also imposed a $20,000 fine and ordered Rocker to attend sensitivity training for the remarks he made to Sports Illustrated ("Report: Rocker calls sensitivity training a ‘farce'" par. 11). In addition to receiving flack from the media and the punishment imposed by MLB, it became dangerous for Rocker to play baseball in New York. His comments enraged Mets fans so much that 700 police officers were assigned to Shea Stadium instead of the normal 60 ("Rocker ranckles fans, retires Mets" par. 27). These are some of the consequences Rocker faced because of his choice to exercise unbridled free speech.
Just because Rocker has the legal right to say whatever he feels doesn't mean he should. In fact, Rocker, being in the public eye must act in a manner that will not be offensive to the public. I like the way an article on Askmen.com sums it up by stating:
Baseball teams work hard to play a positive role within society, with the fans, and especially with children... [t]he bottom line is that as an Atlanta Brave, he should not be affecting the team's relationship with the public. ("Athletes & Freedom of Speech" pars. 10 and 11)
The article on Askmen.com is right; if Major League Baseball, more specifically the Atlanta Braves, want to be a viable organization they, as an organization, must act in a collective manner that is agreeable to fans. Since Rocker is a member of that organization he must yield his tongue to those that control the purse strings - the Atlanta Braves, and ultimately the fans - or be ready to accept consequences. Most organizations care about their reputation: whether a church, a corporation, or the Atlanta Braves. In order for an organization to promote its best image to the public, it will many times restrict the speech or actions of its employees (or members if a church).
In addition to Rocker restricting his speech to promote a better relationship with the Atlanta Braves and his fans, he should also restrict his speech for spiritual reasons. Jesus said, "The good man brings good things out of the good stored up in his heart, and the evil man brings evil things out of the evil stored up in his heart. For out of the overflow of his heart his mouth speaks." (New International Version, Luke 6:45). When Rocker spews venom of hate and bigotry, he shows the world the darkness that is in his heart. Words from James' epistle are eerily prophetic for Rocker:
It only takes a spark, remember, to set off a forest fire. A careless or wrongly placed word out of your mouth can do that. By our speech we can ruin the world, turn harmony to chaos, throw mud on a reputation, send the whole world up in smoke and go up in smoke with it, smoke right from the pit of hell. (The Message, James 3: 4-5)
The wrongly placed words of Rocker threw mud on his reputation and turned harmony to chaos when he stirred up an angry mob in New York. And in Matthew's Gospel, Jesus said, "But those things which proceed out of the mouth come from the heart, and they defile a man." (New King James Version, Matt. 15:18). When Rocker misguidedly practices his legal right to freedom of speech, he defiles himself.
In conclusion, John Rocker is protected by the Constitution to say almost anything he desires, however he should not expect to be able to walk away from those statements unscathed. Rocker not only has the right to free speech, but also the responsibility to use that speech wisely. As a public figure, one to whom much has been given, much is required. The effects of his wrongly placed words are severe and long lasting. Yes, Rocker has the right to be a dope, but he has a greater obligation to his fans, to Major League Baseball, and even to himself to choose his words wisely.
Works Cited
"Athletes & Freedom of Speech." Askmen.com. 5 July 2008 <http://www.askmen.com/sports/fanatic/fanatic7b.html>.
Cornell University Law School. "First Amendment Religion and Expression Freedom of Expression - Speech and Press." CRS Annotated Constitution 05 July 2008. <http://www.law.cornell.edu/anncon/html/amdt1bfrag1_user.html>.
New International Version. Holy Bible. Colorado Springs: International Bible Society, 1984.
New King James Version. Holy Bible. Nashville: Thomas Nelson, 1982.
Pearlman, Jeff. "At Full Blast." CNNSI.com 23 December 1999. 2 July 2008 <http://sportsillustrated.cnn.com/features/cover/news/1999/12/22/rocker/>.
"Report: Rocker calls sensitivity training a ‘farce'." ESPN.com 26 June 2006. 6 July 2008 <http://sports.espn.go.com/mlb/news/story?id=2499926>.
"Rocker ranckles fans, retires Mets." Associated Press. 27 June 2000. ESPN.com. 29 June 2000. 5 July 2008 <http://espn.go.com/mlb/news/2000/0627/607141.html>.
The Message. Holy Bible. Colorado Springs: NavPress Publishing Group, 2002.
Since the recent real estate boom went bust, banks and lending institutions have implemented credit and underwriting policies that have acted as an accelerant to the free fall of property values. These policies, intended to protect the financial organizations, are causing a great deal of harm to those same financial institutions and to the public at large. One such plan adopted by the majority of loan committees has been the primary catalyst for stricter lending procedures causing degenerative cash flow positions for the financial markets. The idiom used to justify that vehicle, a vehicle that siphons much needed liquidity from the parched equity markets, has become a well established phrase in the vernacular of real estate professionals: soft market.
A definition for soft market cannot be found on Merriam-Webster Online, and the results from searching Google (www.google.com) and Librarians' Internet Index (www.lii.org) are less than satisfactory. As a finance professional, I define soft market as a real estate expression, an idiom, used by the collective lending community to describe a region where property values are in decline. A market is said to be in decline when the current property values in a specific area are presently less than the values reported in the preceding calendar quarter. If property values in a particular area have decreased from one calendar quarter to the next that area is identified as a soft market. Typically, these market conditions are caused by supply and demand, when there are more people selling real estate than buying real estate. When an area has too many people selling or not enough people buying it creates a surplus of property for sale on the real estate market. Many sellers become desperate to sell; to motivate buyers to buy, sellers lower their asking prices causing further decline in property values.
Lending institutions have specific procedures for soft markets called soft market policies, which include tightening lending guidelines for the area considered a soft market. These soft market policies may require borrowers to have a larger down payment, require borrowers to provide additional income documentation, limit the type of loan a borrower may obtain, or any combination of procedures with the purpose of providing the lending institutions an additional level of comfort. When lending guidelines are tightened it removes borrowers, consequently buyers, from the market causing an even greater imbalance in the buyer-seller ratio. This imbalance causes property values to fall even further, and fall at a quickened pace. As home prices continue to fall, lenders tighten guidelines again and again removing more and more borrowers, fostering a degenerative cycle.
The impoverished neighborhoods are the first to feel the affects of soft market policies while the affluent may not realize the impact. For example, when compared to the affluent or the middle class, those with lesser means have minimal savings, if any at all, and disposable income is an unknown luxury. Logically, stricter guidelines that require additional down payments or greater disposable income remove more lower-income borrowers from the market. This elimination puts additional strain on the sellers in those neighborhoods, forcing prices even lower while raising the risk of foreclosure for those sellers who are in dire need. The middle class is also affected, but it is those with the least in society who areharmed the most. While the poor drown and the middle class struggles to tread water, the wealthy float along without great concern. As such, the wealthiest in society have the greatest means to withstand the additional requirements imposed on the market, but others do not.
Sellers are not the only individuals affected by soft market policies. A homeowner may have qualified to refinance his/her home last quarter, but not now. Due to shrinking home values compounded with the lending institutions soft market policies of reduce loan amounts, the borrower cannot refinance. Borrowers who are stuck in their current loans may be damaged if their current loans include a feature called an adjustable rate and their interest rate adjusts to a higher rate. If this borrower is unable to refinance they may be forced to sell, thereby continuing the cycle by adding yet another seller to a market already glutted with sellers. Removing borrowers from the market not only removes buyers from the market, but also adds sellers throwing the buyer-seller ratio further out of balance.
Soft market policies were designed to curb the financial losses to lending institutions, and to alleviate potential risk in the market. Not only do these policies hurt homeowners by evaporating home equity, they are also causing greater losses to those same financial institutions implementing these procedures. A bank tightens guidelines to mitigate risk; not to be undone other banks quickly follow the same trend. Again, the cycle is degenerative.
In conclusion, soft market policies have damaged, and continue to damage, lending institutions and individuals alike. The process of removing buyers from the marketplace again and again through additional requirements has not helped to curb falling home prices, and it has only caused additional strain on the property market. The American financial markets are the most innovative in the world, capable of producing a more viable option to protect the interest of corporations and individuals while promoting the best interest of both. Simply stated, soft market policies don't work.
Do you think soft market policies are working? Is there a better solution? Please let me know by sending me an email to dustin.burke@adonaifinancial.com.
The Uniform Residential Loan Application, most commonly known as Fannie Mae's Form "1003", is the standard mortgage form used for residential mortgage applications in the US.
The lender uses this form to record relevant financial information about an applicant who applies for a residential mortgage loan. The 1003 is broken into several parts:
Section I | Type of Mortgage and Terms of Loan: is the section of the 1003 that records the proposed loan amount, interest rate, number of months, etc.
Section II | Property Information and Purpose of Loan: is the section of the 1003 that records the property address, how the title will be held, whether the transaction is purchase or a refinance, etc.
Section III | Borrower Information: is the section of the 1003 that records basic information about the borrower which includes name(s), address(es), phone number(s), social security number, birth date, current address etc.
Section IV | Employment Information: is the section of the 1003 that records the borrower's employment information. It typically includes the employers name, borrower's title, years of employment, etc.
Section V | Monthly Income and Combined Housing Expense Information: Is the section of the 1003 that records the borrowers monthly income from all income sources and compares the current monthly housing expense to the proposed (or new) monthly housing expense.
Section VI | Assets and Liabilities: is the section of the 1003 that records all assets and liabilities of the borrowers which include all bank accounts, real estate, stocks, bonds, mutual funds, IRA, etc. and all mortgages, loans, credit cards, etc.
Section VII | Details of Transaction: is the section of the 1003 that records the funds needed for closings or the funds received from excess funds of a refinance. This section includes adds the sum of all costs of the transaction minus the loan proceeds and credits to give the borrowers an estimated figure for closing.
Section VIII | Declaration: is the section of the 1003 that records the borrowers responses to specific declaration required to be answered. These declarations include items such as bankruptcy, litigation, government debt, foreclosure, etc.
Section IX | Acknowledgment: is the section of the 1003 where the borrower signs the document and acknowledges the legal disclosure required by the lender.
Section X | Information for Government Monitoring Purposes: is the section of the 1003 used monitor the borrower(s) ethnicity, race, and gender.
As you can imagine there is way too much information to place here about the Uniform Residential Mortgage Application, but its easy to get more information. If you'd like more information or have a question about the 1003 please feel free to contact our office at 863-680-2700 or send me an email to dustin.burke@adonaifinancial.com.
"Adonai Financial, your friends in the mortgage business!"
Adonai Financial is a correspondent mortgage lender that sometimes transacts business as a mortgage broker. It is important for consumers to understand our role as a mortgage broker and understand how we are compensated.
An important role of a mortgage broker is to arrange for your loan to be funded by an independent investor or lender ("lender"). Sometimes Adonai Financial will close loans in our own name, while at other times we will close loans in the name of the lender funding the loan. In any event, we are not an employee or representative of the lender.
Adonai Financial and the lender are independent parties.
The lender's role is to provide financing. Therefore, you should look to Adonai Financial for information and assistance concerning your loan and any associated fees and costs.
The cost of your loan: Your loan transaction will involve a variety of different fees and charges. Some of these are charged by the lender, some are charged by our office, and some are charged by third parties such as closing agents, title companies, insurers, appraisers, home inspection services, etc. Your Good Faith Estimate is an estimate of these fees and charges. At or before closing, you will receive a final statement showing actual fees and charges for your transaction. The amount of any particular fee or charge can vary depending on many factors, such as the lender's or any out-of-pocket costs and internal administrative expenses, competitive factors, industry standards and practices, and third party charges. The costs of your transaction may also vary depending on the loan program you select, and any changes you decide upon during the loan process. Do not hesitate to ask your Adonai Financial representative if you have any questions about specific fees or charges.
Broker compensation: In today's lending environment, we will work together to structure your loan to best meet your goals and objectives. If you would rather pay less up front, or if you do not have much cash available, you can often finance your fees and costs through a higher interest rate. If you would rather pay a lower interest rate, you may pay higher upfront points and fees. You should review the options with your Adonai Financial representative and agree upon the terms of the loan (including the interest rate, points, and fees) and the amount to be paid. If you choose to finance some or all of the fees and costs, the we will receive part of the broker's compensation from the lender. This is in addition to, or in lieu of, up-front fees or points (sometimes called "discount points") paid directly by you. You pay indirectly for this lenderfinanced broker compensation through a higher interest rate.
The lender-financed broker compensation is commonly referred to as a "premium." Usually, the specific amount of any broker compensation financed by the lender will not be known until we lock in your loan with the lender, which will be after you have received your initial Good Faith Estimate. The final amount of any such compensation will be shown on your loan closing statement, known as a HUD-1 or HUD-1a. Upon request, you may review this statement one business day before closing.
You should discuss with your Adonai Financial representative how to structure the interest rate and the amount of fees and charges in the way that best suits your particular circumstances. Any questions you may have concerning broker compensation and other fees and costs during the loan process can be answered by our office.
American dreams can come true with the right home loan that's why many borrowers today look to someone who understands home financing and can guide borrowers through the process step by step, an expert who knows your area, the homes, and the available lenders; someone who takes pride in turning dreams into reality.
For years, your professional mortgage broker has been making home financing more convenient for borrowers, offering such valuable services and information as:
• Same-day pre-qualifications
• A professional viewpoint
• Competitive rate shopping
• Convenient application process
• Pre-underwriting
• Access to a variety of lender programs
• Professional loan processing
• Industry knowledge
• Good Faith Estimates of closing costs
• The ability to re-direct the loan if needed
• Relationships with lenders
• Alternative solutions when needed
As you can imagine there is way too much information to include here, but its easy to get more information. To find out more about our role as a mortgage broker or how we are compensated please contact our office at 863-680-2700 or send me an email to dustin.burke@adonaifinancial.com.
"Adonai Financial, your friends in the mortgage business!"
As recently as yesterday the Federal Reserve lowered the Fed Funds Rate another 75 basis points (or .75%) and the misconception from consumers is that mortgage rates will soon go down too. Unfortunately, it's not really that simple because the Fed does not raise or lower interest rates offered to individuals.
The Fed Funds Rate is the overnight target rate for the costs of bank to bank lending. And the rate is just that: a target rate that will wax and wane depending on demand.
Comments from HSN state: Mortgage borrowers need to be conscious of the fact that fixed mortgage interest rates often rise after the Fed has trimmed short-term interest rates. Why? If one of the tonics for a weak economy is lower short-term interest rates, and the Fed obliges, a growing economy becomes that much more likely to occur. A growing economy -- especially at a time of firm or rising inflation pressure -- will tend to press long-term interest rates upward.
So, what does that mean? It means long term rates will probably be on the rise. In addition to inflation working to keep long term mortgage rates higher, perhaps more important is that mortgages remain out of favor to investors. In order to persuade investors to buy mortgage back securities (with affect long term mortgages) higher yields, resulting in higher rates, are required.
Short term rates are likely to move lower depending on the index used to determine the rate. Lower overnight rates have served to move short term mortgage rates lower. Most notably, the LIBOR has benefited for the fresh cash injected into the markets. Treasury values also remain at multi year lows.
The Prime Rate will most likely move lower as a result of the most recent Fed action, however the banks may not pass the savings to the consumers right away. A report by CNN stated that many banks are using the money (and savings) from the Fed Funds Rate to purchase Treasuries, which have a higher yield. The banks are doing this to improve the appearance of the balance sheets after being hit hard by the mortgage crisis. So, the savings on the prime rate may not be felt right away.
As you can imagine there is way too much information to include here, but its easy to get more information. If you would like more information on mortgage rates, or how the Fed Funds Rate affect you please let me know. You can reach me at 863-680-2700 or by sending me an email to dustin.burke@adonaifinancial.com.
"Adonai Financial, your friends in the mortgage business!"
Title Charges is the section of the Good Faith Estimate where fees associated with the title of the property and closing of the purchase/refinance of the property. The Good Faith Estimate is a RESPA required document.
The most common title charges are listed below.
1101 - Closing or Escrow Fee: are fees charged by the settlement agent for the collecting and dispersing all the monies exchanged between the parties to a real estate purchase or refinance transaction.
1105 - Document Preparation Fee: are fees charged by the settlement agent for reviewing and preparing the documents needed to complete the transaction.
1106 - Notary Fees: are fees charged to have certain required documents notarized.
1107 - Attorney Fees: are any legal fees charged in relation to the loan or closing of the property.
1108 - Title Insurance: are fees charged for the cost of insuring the title of the property. Title insurance is required by most banks to insure that the bank's lien is in the property lien position. Having a residential real estate transaction without title insurance is rare.
As you can imagine, there more information than I can put here. If you would like more information about fees on a GFE or items discussed in this section please send me an email to dustin.burke@adonaifinancial.com.
"Adonai Financial, your friends in the mortgage business!"
Reserves Deposited with the Lender is the section of the Good Faith Estimate that details the prepaid fees that are collected by the lender to pay at a later date and are typically called escrow items. The GFE is a RESPA required document. The servicer (or the institution that collects the monthly mortgage payment) collects these items at closing and in your mortgage payment each month. Escrow payments are usually required when a borrower has less than 20% equity in the property they have secured the loan.
The servicer typically collects 1/12 of the anticipated tax bill, insurance invoice, etc. and then places that amount into a separate account called an escrow account. When the appropriate escrow bill is due the servicer will pay that cost from the funds available in the escrow account.
If there is not enough to pay the amount due there is an escrow deficiency. When this happens the servicer will often pay the deficiency and then increase the escrow amounts to cover their expense and start saving again for the next escrow bill.
Common escrow fees are:
1001 - Hazard Insurance Premiums: are portions of the future hazard insurance expense. Typically one full year is expected to be in force at the time of closing and is not collected by the servicer at the time of closing. What is typically collected is an additional 2 - 3 months cushion that will be used to open the escrow account.
1002 - Mortgage Insurance Premium Reserves: are prepayments of future mortgage insurance expense. The servicer typically collects only 2 - 3 months of premium at closing.
1003 - Real Estate / Property Taxes: are prorated prepayments of future real estate / property taxes. The amount collected at closing often depends on when the next tax bill is due plus an additional 2 - 3 month cushion. For example: If the tax bill is due in 8 months the servicer will collect 4 months plus the extra cushion. The remaining 8 months will be collected in the monthly mortgage payments.
As you can imagine, there more information than I can put here. If you would like more information about fees on a GFE or items discussed in this section please send me an email to dustin.burke@adonaifinancial.com.
"Adonai Financial, your friends in the mortgage business!"
Items Required by Lender to Be Paid in Advance is a section of the Good Faith Estimate that lists the items that are required to be paid in advance. The Good Faith Estimate is a RESPA required document. These items are identified with a number in the 900s. Because of the numbering this section is often called the 900 Section.
***This is a list of the most common fees listed in the 900 Section of the GFE. The fees associated with a specific loan may change. Actual fees may be more or less depending on the time of year, or even time during the month, that the loan closes.
901 - Prepaid Interest: is prepaid interest charged for the loan. This fee will vary and depend on the date of the month the loan is closed.
902 - Mortgage Insurance Premium:is prepaid mortgage insurance premium (MIP). This fee is only charged if the borrower has to pay MIP, usually charged for loans with very little equity in the property being used as collateral.
903 - Hazard Insurance Premium: is the hazard insurance, or homeowner's insurance, being prepaid. Most lenders require that the insurance policy be in force one full year from the date of closing.
These are only a sample of the most common fees and costs in the 900 Section of the GFE.
As you can imagine, there more information than I can put here. If you would like more information about fees on a GFE or items discussed in this section please send me an email to dustin.burke@adonaifinancial.com.
"Adonai Financial, your friends in the mortgage business!"
Items Payable In Connection With Loan, often referred to as the 800 Section of the GFE, is typically the first section listed on the Good Faith Estimate (GFE), a RESPA required document, and includes most fees directly associated with obtaining the loan from the lender, broker, or bank.
Loan charges and costs listed in this section are typically identified with a number in the 800 and most charges associated in this section are figured into the Annual Percentage Rate (APR) on the Truth-in-Lending Disclosure.
***This is a list of the most common fees listed in the Items Payable In Connection with Loan section of the GFE. The fees associated with a specific loan may change from program to program. Actual fees may be more or less depending on the loan program.
801 - Loan Origination Fee: a fee charged by the lender or bank for originating or creating the loan. Many times this fee and the Loan Discount Fee are referred to as "points". Please review an article called Florida Mortgages |When Paying Points Makes Sensefor more information on paying points.
802 - Loan Discount Fee: a fee charged to the lender or bank to get a lower mortgage rate. Many times this fee and the Loan Origination Fee are referred to as "points". Please review an article called Florida Mortgages |When Paying Points Makes Sensefor more information on paying points.
803 - Appraisal Fee: a fee charged to pay the cost of an independent appraiser.
804 - Credit Report Fee: a fee charged to pay the cost of the credit report.
805 - Lender's Inspection Fee: a fee charged by the lender for the cost of inspecting a property. Some lenders call this an appraisal field review where the appraisal is double checked by the lender for accuracy.
808 - Mortgage Broker Fee: an upfront fee charged by a mortgage brokerage business. In rare cases this fee is identified as points and has the same effect as points. Please review an article called Florida Mortgages |When Paying Points Makes Sensefor more information on paying points.
809 - Tax Related Service Fee: a fee charged by the lender to pay the costs of handling tax related matters. This fee is typically very small.
810 - Processing Fee: an administration fee charged for processing the loan (i.e. collecting application details, collecting underwritings requirements, ordering inspections, title, etc.)
810 - Underwriting Fee: an administration fee charged for underwriting the loan.
812 - Wire Transfer Fee: a fee charged for the costs of wiring money on the borrowers' behalf.
These are only a sample of the most common fees and costs in the 800 Section of the GFE. Other fees may include courier fees, MERS registration fees, electronic storage fees, etc.
As you can imagine, there more information than I can put here. If you would like more information about fees on a GFE or items discussed in this section please send me an email to dustin.burke@adonaifinancial.com.
"Adonai Financial, your friends in the mortgage business!"
The Real Estate Settlement Procedures Act (RESPA) requires that mortgage lenders and brokers provide a Good Faith Estimate (GFE) to customers who apply for certain RESPA regulated loans. A GFE is a itemization of expected loan costs and fees associated with the loan and must be provided to the customer within 3 business days of application.
The GFE is only an estimate and the final costs and fees may be different. The GFE itemizes the fees and costs into six basic headings with each line item cost having a specific number associated with the fee or costs.
This is a list of the six sections of the GFE and link with extensive descriptions on each section and many of the fees included in those sections.
Items Payable In Connection With Loan is typically the first section listed on the Good Faith Estimate and includes most fees directly associated with obtaining the loan from the lender, broker, or bank.
Reserves Deposited with the Lender are prepaid fees that are collected by the lender to pay at a later date and are typically called escrow items.
Title Charges are fees associated with the title of the property and closing of the loan
Government Recording & Transfer Costs are fees associated with government costs of the transaction which may include recording fees, stamps on the deed and mortgage, etc.
Additional Settlement Charges are charges that do not appear in the other fives sections of the Good Faith Estimate.
Articles have been (or soon will be) written regarding each section of the GFE with their respective costs. As you can imagine there is a lot of information available through the links above. If you need assistance with a specific fee on the GFE please send me an email at dustin.burke@adonaifinancial.com.
"Adonai Financial, your friends in the mortgage business!"
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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