The U.S. Department of Housing and Urban Development ( HUD) , has created a new ” Good Faith Estimate ” for and new rules for this form. The form was originally developed to help consumers understand the fine print created by lenders. It was also developed to encourage borrowers to shop.
KEY POINTS -
There is a period that the lender MUST give the borrower to review the documents. At least 10 days.
If there are changes in the original docs, the borrower could need at least another 3 days to review the docs.
This may be overly simplified, because there are very complicated rule on each item, but at the end it boils down to 10 days for big $$$ things, 3 days for small.
What does this mean? GET YOUR LENDER TO GIVE YOU THE GOOD FAITH ESTIMATE IMMEDIATELY so that 10 day clock begins to run. Then, if you need to make any changes, you can close within 3 days of the buyer receiving new docs.
Here is a sample copy of the new good faith estimate HUD GFE.
