Unless you have bought a home in the last year or so, you may not be familiar with the Good Faith Estimates (GFE) issued by mortgage lenders or the universal closing statement, the HUD-1.  Effective on the first day of this year, the federal government (HUD) requires lenders to give consumers a very different Good Faith Estimate at the time of mortgage applications.  Why?  Because consumers often complained that the terms and costs they experienced at closings were very different (higher) than they anticipated.  If increases in costs were discovered for the first time at the closing table, some buyers felt like they were being held hostage – either pay them or start the entire home buying process over again. The new form is intended to fix that, requiring the use of a consistent form issued within 72 hours of application.  If some closing costs appearing on the HUD-1 closing document are 10% or more above the GFE, the closing will be delayed.   It’s impossible to explain all the changes in a brief paragraph, but additional information is available at www.hud.gov.

This remains one of the best times to buy a home that we have seen in many decades.  We suggest you begin the process by seeking professional counsel.  Full-time Realtors at The Danberry Co. are prepared to help you, as are the Home Mortgage Consultants at First Mortgage Consultants, LLC, an affiliate of Wells Fargo Home Mortgage.

Have you experienced problems with Good Faith Estimates or at a home closing?  Please share the good and bad experiences with us.