I receive many questions about the documentation needed when you apply for a mortgage loan. Everyone wants to know what interest rate they are being charged. They also want to know what fees are there. The Good Faith Estimate or (GFE) is a very critical document for the borrower. Be sure to look at it in detail and don't be shy to ask questions. The Good Faith Estimate will list the following:
- The Interest rate you are being charged
- The loan amount
- The Term of loan
- Items Payable in connection with loan
- Reserves deposited with lender
- Title charges
- Government recording and transfer charges
- Additional Charges
- Summary of the transaction
- Summary of your payment breakdown
Most people seem to forget that the Good Faith Estimate is exactly that, only an ESTIMATE!We do our absolute best in predicting your fees, however these estimates are rarely exact. Title charges vary by title company and some county's require the costs be distributed differently. For a purchase, we don't know what you insurance will be and in some cases we must estimate your taxes. If you have a lien that we are unaware of that shows up on title, this will obviously affect the loan. As we all know interest rates change daily and the rate initially quoted to you may not be available come closing. This is rare, but as your file gets worked circumstances can come up. When this happens the underwriter has the power to adjust the deal slightly and it affects your pricing. As these details come available to us, we can adjust the loan. A good Mortgage Broker will keep you up to speed when any changes occur and how this will impact your closing costs and payment! Lastly, once the deal goes to closing we require our brokers to call and go over the final fees and loan terms with our client before closing. You should always require your broker to do this. We at Professional Mortgage Group, Inc. do not want any surprises for our clients!
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