What is the Good Faith Estimate?

The Good Faith Estimate (GFE) is a form designed to encourage you to shop for a loan so you can determine which mortgage is best for you. It shows loan terms and settlement costs that you will pay and explains which charges can change and which charges must remain the same. It also contains a chart allowing you to compare multiple loans and costs.

The GFE may be provided by a mortgage broker or the lender and until they give you a GFE, you may only be charged for the cost of a credit report.

To complete the GFE, the loan originator will need your name, Social Security number, gross monthly income, property address, an estimate of property value, and the loan amount. Your Social Security number is used to obtain a credit report showing your credit history, including past and present debts and the timeliness of repayment.

Whether you apply for a loan with a lender or mortgage broker, you should obtain GFEs from multiple loan originators to make certain you get the best loan product at the lowest rate and costs.

Your choice of mortgage lender or broker, and type of loan, will influence your closing costs and your monthly payment.

You should let the lender and settlement agent know that you will want to see the HUD-1 Settlement Statement one day in advance of loan closing and you should question any amount that you do not understand.

More information about the GFE and RESPA is available at https://www.consumerfinance.gov/ask-cfpb/what-is-a-good-faith-estimate-what-is-a-gfe-en-146/  

RESPA


All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.


Topic Number: KA-02423