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New Good Faith Estimate of Closing Costs
New Good Faith Estimate of Closing Costs
Sometimes the hardest part about having new forms is that, well, it's NEW! It's DIFFERENT! We have to create new scripts to EXPLAIN it so that our clients can UNDERSTAND it. But first... WE have to understand it.
So here are just a few points regarding the new Good Faith Estimate that I hope will help with that.
First, we have to recognize the old Good Faith Estimate was really an estimate focused on how much the BUYER needed to bring to closing and how much they would have to pay monthly.
Now, we have an estimate of closing costs related to the mortgage REGARDLESS of who pays! No credits offsetting, just a disclosure of the expenses. Let's do a simple down and dirty comparison of then vs now to help get my point across.
For the purpose of ease, we'll pretend we have an FHA loan with a sales price of $100,000.00. Here are the other details for my example:
The buyer is putting minimum down of 3.5%, or $3,500. Buyer has put $1,000 earnest money down. We'll pretend the total closing costs and prepaids are about $4,000 and the seller is going to pay them. And of course, on an FHA ... more

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