If you are currently shopping for a new mortgage you want to avoid overpaying lender fees for the new loan. Using the Good Faith Estimate can help you avoid overpaying lender fees and closing costs for your new mortgage. If you neglect to review the Good Faith Estimate from your lender you could be throwing your hard earned money away.
The Good Faith Estimate your mortgage lender is required by law to provide you outlines every expense charged for your mortgage. This document itemizes all the charges and shows who they are paid to; pay close attention to what these charges are and were they are going. Use this list to ensure that you are being charge reasonable amounts by comparing the Good Faith Estimates from a variety of mortgage lenders.
Make sure the document the lender provides you is actually a “Good Faith Estimate” and not simply a summary of lender fees. Mortgage lenders are required by law in the United States to provide this document; if your lender is stalling or blatantly not providing it you should find another mortgage lender.
The Good Faith Estimate is an excellent tool for comparison shopping for a mortgage loan. If you review this document with a fine tooth comb your lender cannot slip charges or rate changes into your loan contract. Mortgage brokers and lenders often try and disguise fees in their loan contracts; these lenders and brokers are required to provide you with a Good Faith Estimate within three days of receiving your application. Make sure you carefully review this document and understand all of the fees associated with your mortgage.
It is a good idea to keep the original endorsed copy of the Good Faith Estimate provided by your mortgage lender. You can use this document to reconcile fees on your final mortgage contract. If you find changes your lender will need to explain why the figures have changed. You can learn more about protecting yourself from advantageous mortgage lenders by registering for our free mortgage guidebook: “Five Things You Need to Know before Refinancing Your Mortgage.”
Mortgage Refinancing
