George's Blog

I'm not impressed with the new form.

I didn't see any problem with the old one.

Just because it's new doesn't make it better.

George - Thanks for the preliminary info....will be waiting for your future posts on the further effects of the changes.

Thanks for the informative post George. I think I need to re-educate myself on this. Just when I thought I understood it, it changes! Thanks for the heads up!

Thanks George. I've heard a lot of moaning and groaning up here over the new form. It doesn't look that complicated to me.

George, I want to see the follow ups you do. There are a lot of questions going around.

Someone today said it was required for a pre-approval. Thanks for the post.

Hi George,

Happy New Year...I agree there seems to be some good and bad with this new rule. I definitely agree with the standard form. I think they should have done it before just like us Realtors have certain forms that have to be the same as well. I'm not sure what the impact will be on the down side since I do not work in the mortgage business but I'm sure you're aware how to represent your clients properly.

George, expect change. I think they are trying to make things better and in some cases they have and some they have not. It will be a struuggle but I think that it will be different by the end of the year, especially if all of us are politically involved in this.

It is what it is....

Patricia

George,  A lot of change requires a "shake down".  I do expect it will only lead to more change!  All the best in 2010!  Michelle

Lenn, I agree.  I understand what they are trying to do, but what they wanted to do and what they have done, are very different.

Donna I am hoping to do the next post tomorrow.

Sherry I am still trying to grasp all of it myself, in fact we are having another training on this tomorrow morning.

Monika, looks can be deceiving, there is more to it than first meets the eye, especially it you are the eye's that have to put it together :)

Ted, it is not required for a Pre-Qual.  In fact I would say that most Lenders will NOT issue one, even if it is requested with a Pre-Qual. 

Neal, like anything else all of the ramifications of the new form will most likely not be known of felt until we have been using it for a few months.

Joe, I hope you are right.  They could have accomplished what they were trying to do by just having chosen one of the exsiting GFE Forms and making everyone use it.

Patricia, you are right it is what it is, but it could have easily been better.

Michelle, what I am concerned with is that this will lead to less disclosure instead of more.

George,John Occhi has formed a new "Group" called RESPA where several of us are posting about the New GFE.  You may wish to join that so we can consolidate all the posts on this very important topic affecting both Realtors and Loan Officers alike.

I have made two posts there so I won't rehash it here.

http://activerain.com/groups/RESPA

Thanks.

Rick thank, you I will do that.

I closed a home today with the old form.  Can't wait to see the changes on the new form.

From our viewpoint it sounds like a good idea that everyone use the same form. No?? We will be checking back with you for the rest.

Some parts of this I commend but it is certainly giving me a headache

George,

Good breakdown of the pros and cons... it seems mostly good to me.  I like the way that buyers will be able to do a more "apples to apples" cost comparison between lenders and title companies.

Sue

George, why am I not surprised that the reason the new good faith estimate and HUD 1, were updated Will also be the reason why lenders will try to avoid the commitment of them until the last minute, thus defeating the original purpose of the change.

George.. Like always you are right on top of things.  Frankly my thought about this new form is "Why fix it, if it isn't broke".  There is no reason why, from what I can see that the old forms should have been changed.

George, thanks for this information and look forward to the next post on this subject.

George,  I do believe there is some benifit to the new GFE, however I do believe it is overkill.  Consumer eduction and understanding will be the challenge.  I have two problems with the New GFE.  The first being the new form does nothing to tell the client how much money they will need at closing.  The second issue is some of the costs that need to be quoted and included in the total that HUD suggests a borrower when evaluating different GFE's can be easily misquoted intentionally or in error without being subject to the ZERO or 10% tolerance.  Also, here in Nothern Ohio some items that must be quoted are actually paid by the Seller according to the contract.   Telling a borrower that we have quoted this costs, however it is being paid by the seller will likely just add to confusion.

I believe items 3 - 11 should be Identical on every GFE because they are not Lender Controlled.  This is where I see lenders puffing their GFE's. 

Also, I believe most buyers are most interested in how much money they will need is of most importance.  If lenders develope their own forms to show that, I believe consumers will use that instead of the NEW GFE.   (JUST MY OPINION).   Thereby defeating HUD's Intent of one standarized Form.    

This graphic was posted almost 2 months ago on this posting http://activerain.com/blogsview/1333560/the-new-good-faith-estimate-gfe-form-page-2-section-b
IF you review the items that can change, I believe you can see what I am talking about. 

George,

At the first look, I thought to myself, what a nightmare.  However, this is what I have come up with that I like a lot. 

• No more low ballers!  This means Loan Officers who low ball the heck out of the estimate to earn the business to only later switch it all around.  If they low ball they are on the hook for the difference.
• It will keep clients a bit more loyal to you as they have a shorter period to shop around to only find that the next guy offers the same thing however he got the last look and beat it by $100.00 (Anyone can do that). 

However, you can provide a client with an estimate without being locked into any agreement.  It is called a Preliminary Estimate of Charges.  Only when you have a complete loan application (meaning when you have a contract i.e. property address are you to provide the client with a GFE which then binds you to the quote for 10 days.  However, this is the fine print, this only pertains to a rate that is "LOCKED".  If the client determines they want to float, then you can change the rate accompanied with a "Changed Circumstance Form" explaining the rate/ market had fluctuated.  However the fees are another story but as LO's we should have a good handle on how much fees will come out to.   With the new rules, LO's will need to high ball a little to cover their butts.  The REALTORS will need to support us and not find the opportunity to claim that we are too high on the fees or any of the typical about fees.  What many do not understand is that if we estimate $1k too low, we are on the hook for that money. 

My office just had someone almost make a $2,000 mistake today. Luckily I found the stipulation to help him get out of the quote he sent. 

Effect, not Affect.... Georgie

This form will be fun for the biz..... Realtors need to get ready for elays...

It seems that perfection does not exist in any forms that have to do with loans...

Thanks for the great info...I look forward to your next post.

Thanks for the great posting, you have us all thinking, I thought the nature of this beast was to make sure that there was disclosure, disclosure, disclosure in a timely fashion.  With some of the commentary here I am doubting that will happen.  My major concern was regarding the closing date and how we should address that in a Purchase and Sales Agreement.  I don't want my buyers monies to be in jeopardy should they not be able to perform on the date indicated on the purchase and sales agreement due to a change on this statement.  I do hope you will address these concerns in your future postings.  Thanks and happy new year! 

MaryBeth Mills Muldowney, TradeWinds Realty Group LLC, Massachusetts

I don't understand why the "government" cannot put together a form that make sense and helps the consumer.  I think they need to hear from everyone on AR regarding the downside of these forms.  I think if they have thought comments, they may revise some of the changes that make no sense to those of us who are active in the real estate industry today.

I'm not big into the new form either.  We had a company wide training and it doesn't seem to have any more value than the old form.  Change isn't always good.  I suppose we'll adapt and overcome yet again.  As far as I know it's lacking tax prorations as well. 

I really like that the new forms will allow the buyers to compare apples to apples when rate / loan shopping, but I think you are right on -- the loan officer will not want to give the GFE to the buyer until after they are already under contract on a home.

It seems in some ways the new Good Faith might be helpful, but I'm afraid it's going to cause confusion.

George: Thanks! I appreciate it. Whether we like it or not, it's here to stay. I plan on adapting and continuing on. Everything will be just fine. Take care.

It's gonna take some time to get used to the changes. Of course the first page is pretty much the same, just a new name.

Thanks for the post. Looking forward to reading your other ones.

Thanks for the informative post George.  The new GFE will have positives and negatives.  I am keeping an open mind to the changes.  I look forward to your next post.

~Pam

Thanks for the lender update, George, and for initiating the conversation.

Thanks for the info....I like your point on the length of the blog...I'll stay tuned for the future information! 

Hey George!  This one will probably cause some headaches for a few months, but it appears to be clear in many areas!!  Thanks for the update!

Great Post, George.  As a Mortagage Banker/Broker and Realtor I can see the benefit and the negatives.  I do see a great benefit of a buyer being able to relly compare Apples to Apples etc.  The day of the low baller just to get the business and up the fees just before closing I think (Thank God) are done.  I have been in the business for 18 years and this is the largest of changes I have seen to date.  There will be delays and plenty of confusion to start the year, but by the end I think everything will have settled in. 

This will be a very interesting road indeed.

Thanks for the Post

My Best,

Lawrence Bland

That's an interesting point  about lenders possibly delaying on doing the forms.

As Ted said, no more "low ballers." That's the purpose of the new Good Faith Estimate. Too often, "less than scrupulous" lenders / brokers were less than forthcoming about the true rates and fees for a given situation at the time of initial disclosure, and often find ways of hiking up those quoted rates and fees just before settlement. In many cases, this left the borrower with no choice but to accept the new terms.

One drawback for the consumer is they must now have their credit pulled if the want a good faith estimate. Lenders / brokers will not provide a good faith estimate unless they have at least 6 pieces of information, including a social security number. This will limit their willingness to "shop" mortgage lenders / brokers for the "best" rates and fees for their situation. But then again, there will be no more "low ballers."

TED CANTO wrote: 

"No more low ballers!  This means Loan Officers who low ball the heck out of the estimate to earn the business to only later switch it all around.  If they low ball they are on the hook for the difference."

NOTICE TO LOAN ORIGINATORS.  If you quote a dollar amount for lender fees or any other fees on a GFE for one of my home buyers, the amount on the HUD-1 at closing had better not be a dime more. 

Don't try to lump fees together either.  When making a loan application, we'll ask for a break out of lender fees. 

Sorry George.  Don't mean to hijack your post, but this is good stuff and I can't sit by and just read.

DELETE IF YOU LIKE.

Great explanation-thanks, George.

For the life of me I'm trying to figure how in the world this form is going to save a average of $700 to the client. What has been spent and will be spent on legal along will increase cost

Tony

George, uniformity is a great ideal, but not always achievable. The majority of culprits that necessitated this action have fallen by the wayside. Keeping the buyers from predators that bait and switch will be the true reward. Thanks for the update.

George I was able to go over the form line by line with Ken Cook and I think it does offer more transparency which is good for consumers, after the recent debacle.

Love it, hate it the reality is we will have to work with these forms so it is important to take the time to get familiar with them.

I always look forward to your updates on mortgage issues, it is information I need but not my area of expertise.

George,

The government is here to help simplify things.  Take a single page form, work the simplicity magic, and voila!  A Three Page Form!  (That doesn't tell the buyer what the PITI will be...)

Mike in Tucson

Just another change in the world of Real Estate. It seems today there are changes almost weekly!

Just another change in the world of Real Estate. It seems today there are changes almost weekly!

George, your very timely post ~ creating awareness of the connotations of new GFE 'mandatory' form...  It seems to me the form will have to be revised.... If a GF estimate is not fully broken down and prices inflated to cover the loan originator, then borrower is worse off. And if other forms have to be filed, it is time consuming, thus, wouldn't this add to cost anyway?....

I look forward to your updates.

Isabel Waters, Waters Real Estate, Fort Lauderdale, FL

I really don't have a problem with the new standardized form.  From a Consumers standpoint, I think it's good and will help borrowers bestter determine their costs associated with obtaining their mortgage.  My bigger concern is with additional changes that may or may not develop with regard to the process.

Thanks to Tim for also posting the link back to the GFE copy and earlier post. Very good information and comments

I would not like to see lenders not giving GFE's until loans are in process, comparing GFE's is one of the things I always advise.

After a complete application has been taken, it will be unlawful for a lender to not provide the new gfe form within three business days. Lenders will however be allowed to put an expiration date on the form. The new law requires that the fee's be available for 10 days. The rate quote have have an expiration date that is specific not only to an expirtion date but a time on the clock as well...

Jason

When was the last time the goverment made anything more simple? Have you looked at the tax laws?

Thanks for the post. Unfortunately the biggest challenge will be for the borrower to understand where costs will be lumped together.

Thanks for the info.  I will need to review this form again.

George, I agree with most of your statements about the new form.  I do not like the lump sum of cost any more than you.

George, thanks for sharing this information, I'm looking forward to your other posts regarding this subject.  Fact is, the new GFE is here and it is what we have to work with so we might as well get informed and educated... and fast. All the best in 2010!

Thank you George.  I am looking forward to the follow up posts from you.

I guess the one good thing about me just getting into the lending biz is that everything is new to me and I can't compare the old from the new. Ignorance is truly bliss in this case.

I REALLY like that lenders can no longer charge hundreds or thousands of dollars up front. Too many people got locked in to using lenders who  gave lousy service after the upfront fee was paid.

For those who complain about what the form doesn't provide, can't you still provide that info? It would be a way to make your service stand out.

I took a class on December 28 about the new GFE and the corresponding settlement statement.  It was taught by a local attorney with a title company and sponsored by a local bank.  I am glad I went. 

We've had ongoing updates from our inhouse lender and title people too... as info came out in 2009 but it seemed so far off. 

Happy 2010.

The new HUD Settlement Cost booklet does a pretty good job of explaining the whole loan process.  I recommend that every Loan Officer and Real Estate Agent read the entire 49 pages so you have an idea of what the client will be reading

I have heard good and bad.  There are probably good reasons to do this, but problems with the approach taken.  We will have to wait and see how it plays out.

Just because it's new doesn't make it better. I don't see how this benefits the buyer?

well, before now, lenders did not have a fiduciary duty and lenders charged what they want and put conditions on funding or docs that cost SOMEBODY money and the original purchase contract had not predicted that lender condition, so now the lenders may have to play in the same sandbox with the contract? Until lenders are 100% a part of the entire contract (and have to SIGN IT) then lenders will still not be responsible enough to the CLIENTS, both seller and buyer.

I agree this form has the good and the bad. But I believe the bad outweighs the good. Once again rule changes with no pratical application for the market. I will look forwad to future posts.

Kay you will be seeing it real soon, and Loan Application taken after December 31, 2009 has to use the new GFE.

Al and Peggy, yes it is good that everyone is using the same form, what is not good is that it actually discloses less than the GFE that I was using.

Art ..... LOL ,,,,,, initially this is giving us all a headache

Sue, that is a good thing, but there are a couple of con's that I forgot to put in this blog that I will include in the next that might cause you to ask what were they thinking.

Steve, if they had just required everyone to use the same format we would probably not have that problem, but they want Lenders to guarantee things that they might not have control over and eat the costs, so in a sense they have defeated part of what they were trying to accomplish.

Valerie I can see the need to make everyone use the same form to make it less confusing to Borrowers, but I think they should have just chosen form one of the existing forms and have left it at that.

Rebecca, I will be trying to write the second one today.

Tim, I agree and thank you for you input.  This starts to cover some of what I intend to include in the second Post.  By the way we have already come up with another form to try to make some of the costs clearer to the Borrower.

Ted my understanding (and we just had another training class on this today) is that once a new GFE is given to a client, whether they have found a property or not, or whether an application is completed or not, the 10 days kick in.  There are costs that have a "0" tolerance and can not change no matter what within the 10 days and that is the problem.  So Lenders will most likely come up with some form to state their costs without using the new GFE when they are Pre-Qualifying a Borrower, which defeats in my opinion what they were trying to do with this form.

Ton thank you for the correction, I need a lot of help in that department.  By the way did you mean "delays" ..... LOL

George, I am not sure why you deleted my reply#69 which had the HUD contact link etc..

I do not view the new GFE as being equal from all sources for lending..IE: Banks versus Mortgage Brokers..

The lenders "option to not disclose" the built in margin for a given loan is a considerable difference that many borrowers reviewing different GFE will not easily discern.The monthy payment shown on the form does not clearly show the Principle , interest and the Taxes and Insurance as the total payment..it only show the PRinciple, Int and Mortgage ins total.

so I agree the old form was easier to show where the funds are being allocated.

Do you feel the seller credit or financed closing costs are explanable in this new form?

Regards,

Michael Z.

Judi, perfection is hard to achieve in anything, but we can try.

Jamie, hopefully I can get to that second Post today.

Marybeth, a last minute change that could result in re-disclosure could present a problem, that that risk existed before with the new Truth In Lending Statement that was rolled out a few months back.  I don't see this having a big effect on Closing Dates, but that should become clearer in the next few months.

Joan that is a good suggestion, but problably not very likely to happen :)

David, I am not a big fan of it either, but I will make it work as best as I can.

Kerry, yes you are right and for that reason it defeats a lot of what they were trying to accomplish.

Hi George, the  new 2010 GFE also does not show the borrower the amount of money that will be required to close, what their total payment  (PITI) is, or even have a place to sign.  It's obvious that the people responsible for creating the wonderful new 2010 GFE have never worked in the mortgage industry. 

Daniel Litvin

www.AdvantageLendingCorp.com

In reading many of the responses, I can still see there is a massive amount of educating that needs to take place. The very first comment made by Lenn is correct, "Just becuase it's new, doesn't make it better".

The new form DOES NOT:

1. It does not show the monthly payment at all.
2. It does not show how much the customer needs to bring in at closing.
3. It does not itemize costs so the customer can see what they are, just lumps them all together.
4. It does not have a signature line.
5. The new form is now three pages instead of one.

Good luck to us all !!

Christine the confusion has already started :)

Paul I will to, but I still don't like it ........ LOL

Roland, over all yes, but the grouping of costs instead of listing them separately provides less disclosure.

Tonia, thank you.

Pam I am trying real hard to do the same, but .................. :)

Tiffany you are welcome

Andrea, the length on blogs was something I learned real quick here on AR, especially since I have a tendency to move on when I click on a lengthy blog.

Stephen, somethings are clearer, but grouping costs creates new questions.

Lawrence thank you for your input.  Having the same form goes a long way to keeping things apples for apples.  that is a big positive.

I am glad to see other originators take on the new GFE.  I have tought several classes to realtors (about 600) and the more I tought, the more flaws I found in it.  I agree there is a need for change to protect consumers and elimate abusive lending.  This form, in my opinion, will cause more confusion and possibly cost some people their loans.  The biggest "holes" that I find in it is on 3 pages the sales price does not appear anywhere. Second, the type of loan applied for i.e. conv. FHA/VA.  Third, the total loan amount is not given, Just the principle, interest and any mortgage insurance (does not show total payment for propterty taxes and homeowners insurance).  Fourth, it does not give the accurate amount of funds required to close.  This has to be done seperately.  So how does this benefit the consumer so they understand the bottom line?  Answer is, it doesn't.  Why would you list the UFMIP/VA Funding fee with title charges?  These get finaced into the loan and skews the "bottom" line number.  Here in Oklahoma, 80%+/- of our loans are FHA.  I think that there are some really good features, but there needs to be some adjustments.  It would be easy but our so called elected officials (whom I doubt are experts in mortgage lending) will make changes in time.  Expect any changes to take at least a year.  Good luck to everyone and let your voices be heard by your organizations and push for change.

George, I need to give credit to Posted by Benjamin Clark - Exclusive BUYER'S AGENT - Certified Negotiation Expert - SLC, UT for the Graphic.  

One fear that I have is Buyers Remorse when they see the Settlement Costs totaled on the New Form.   I do not know how you feel with regard to HUD's new settlement cost booklet  and the fact only about 5 pages of the 49 pages relate to the GFE.  The document deals with many subjects and it is the lenders requirement to give the booklet to buyers.  I personally would recommend buyers receive the booklet well before they make an offer on a home.   

I would be very interested in seeing the form you(your company) is developing.  I will send you an offline message. 

Cheryl, they are having to guarantee some of the cost without knowing all the information on  an initial Pre-Qual and they will most likely not be willing to do that.

Lewis, eliminating low ballers was it's primary goal and hopefully it has accomplished that.  Time will tell.

Lenn, you are welcome to hijack my blog any time you have earned that right.  Like you I don't like it when costs are lumped together, but that is what this new GFE does in many area's, and even if a Lender wants to break them down, they can't do it on the new form, because they are not allowed to add or delete from it.

Lisa you are welcome

Tony I don't know about that, but we will soon find out.

Ed, you put that simply but accurately :)

Jennifer in some cases it does offer more transparency, but it has less transparency in more places.  An example will be two things that I will include in my next blog.  No where on this new form is the Loan Type or Monthly Payment shown, and that is not good.

Mike ...... LOL ...... Good point I just made that comment about the Monthly Payment to Jennifer before I read your comment :)

Bill, and some times daily ....... LOL

This is going to be a challenging year.   

This Good Faith Estimate was not looked at and approved by mortgage and real estate professionals but by beaurocrats who have no experience in our business. 

*The total monthly payment is now shown since escrows are not part of this GFE. 

*The sum of the closing costs are not disclosed.

*The costs are not broken down fully.

Isabel I had not looked at it that way, but it is a point worth considering.

Tom, I guess my point is that they could have accomplished the standardization, which is good, by just having standardized on one of the existing GFE's

Wendi, Tim's comment was very good input

Vanessa, well that is probably not going to be happening any more until the Lenders get a better handle on this.

Jason the is very true, but they don't have to provide one with a Pre-Qual, and don't think they will, at least until they get a better handle on this new form.

Alan, good point ......... LOL

Mark that is going to be an issue.

Susan, we all are going to have to review it over and over in order to get a better handle on it.

Douglas, that and not including Loan Program and the PITI are big concerns with me.

Silvia, yes that is very very true.

Diane, if I ever finish responding to comments I will post it ......... LOL

John, yes there is a lot to be said for that ........ LOL

Joetta, the things that are no longer broken down on the new GFE can be disclosed, but not on the new GFE.  Lenders are not allowed to add or delete anything.  So what it is, is what it is.

Maureen, yes it did seem so far off, but it is here now ........ LOL

Karen we just got the new ones in last week and I have not read it word for word yet, but i will be doing that this week.  As far as Borrowers go, I have yet to have one tell me that they read the old booklet :)

Gene, problems with the approach taken is an excellent way to put it.

Nicholas, standardizing the form for everyone is a benefit, but you are correct about other changes not being a benefit.

Barbara, the new GFE does not solve the problem that you raise.  Lenders can continue to make the same conditions that they have in the past.

Markita, I do think that the standardization is a huge thing, but I am of the same opinion as you that  there are more negative changes than positive ones.

Michael I deleted the comment because it was addressing something that was an issue with the old form, and the new form did nothing to change the way that Lenders and Brokers disclose there costs, and that is not the issue here.  As far as Seller Paids go, they are disclosed on Page 4 of the 1003, but it would have been nice is they were disclosed on the new GFE as well, by putting a couple of additional lines on page 3 of the new GFE to not just show the total amount of settlement charges, but also the seller paids and the net amount that the Borrower is expected to bring to Closing.

Daniel you are right.  The only place for a signature is on a forth page which discloses the vendors.

Mike it does shows the Principal & Interest, PMI, or FHA Monthly Insurance, but does not show the total payment with Taxes and Ins.  But the intent of your comment is correct, it leaves out needed valuable information.

Chris those were excellent additions to my Post.

Tim, as I stated in a comment above, I just got the new booklet at the end of last week and have not gone through it line by line yet.  It is a good suggestion to give this booklet to Borrowers before they apply for the loan, maybe then they would actually read it.

Jack like you said it is lacking some basic information that it should have.

One of the things this new form still does is make an uneven playing field between mortgage bankers and mortgage brokers.

Mortgage brokers are now required to give any yeild spread premium (YSP) to the borrowers.  Period, no choice.  Mortage bankers are STILL NOT required to disclose YSP and don't have to give it to the borrowers.  So, what you have when comparing is the following:

A banker quotes a 5% rate that pay them a 1 point YSP.  They also charge a 1 point loan fee as well, making 2 points, but because they are a bank, they only have to disclose the 1 point loan fee on the new GFE (it was the same on the old GFE as well).  So to the borrower, the bank is making 1 point on the loan, when in fact they are making 2 points.

The broker, at 5% as well, has to show that they are charging 2 points on the new GFE.  Then, they have to give back the 1 point YSP to the borrower.  The borrower uses that YSP to apply to the 2 points there by paying only one point, but it still disclosed that they are paying 2 points.  The result is the same, but the the broker is at a disadvantage because the banker can sell against this by saying they charge less, even though they make the same amount of money.  The broker looks greedy for wanting the make 2 points and the bank looks like a hero only charging 1 point.

Is this the end of the world?  Of course not, and full disclosure is a good thing.  But, as usual, banks and brokers are not playing on an even field.  If brokers have to give back the YSP, then the banks should have to as well.  This has been a pet peeve of mine for as many years as we have had YSP disclosure requirements and the mighty federal government/HUD still refuse to open their blind eyes to this.  Or, more likely, the mightly banking lobbyists poor too much money into the politicians coffers to make things fair. 

Everyone is still working on fully understanding all these new changes and I'm sure lenders will lose money on loans because of mis-understandings or doing things incorrectly.  This is the learning curve, but it will only slow down closing deals as lenders tread very carefully to make sure they have everything exactly right.

Well this is going to be one of those things were there will be lots of talk and I believe soon to come lots of complaining

It's very important that we (in the industry) take the time to understand the new form and all that implies. This morning at our office sales meeting, a local title company owner presented the new form and explained her views on the pros and cons.  You've hit on the good and maybe not so good.  I'll look forward to your following posts as well. 

Goodness...there's going to be some major hooha's over this. Let's see what all this brings :)

Guy the post is about the New Good Faith Estimate, and what positives and negatives that it has compared to what was disclosed before.  What you are talking about is the same for both new and old GFE's, no change.  And the issues you raise are a topic for a different post.

Gene, I don't think that you will have to wait very long for the complaining.

Jan, I am sure that there are pro's and con's that we will not fully realize until we have been using the new form for a few months.

Sally .......... "hoola's" now I like that .......... LOL

George,

The lack of the cost breakdown will puzzle borrowers and here is where mortgage consultants have to communicate all that info to them.  

Again George,
thanks for a well done informative blog about the new changes on the mortage industry, keep the good work my friend!

Good post.  Thank you.  We all need to follow the new RESPA rules.

Thanks for the info, will watch for the updates!

George,

     Great post, especially the last few paragraphs.   The point which you made about the new GFE still lacking the necessary breakdown of certain costs that were hidden on the previous GFE is absolutely right, and a serious weakness in the new GFE.   The 'orgination costs' on the top of page 2 is particularly inadequate.   Letting borrowers know the exact dollar amounts of YSP, loan underwriting, processing fees, and other fees that will continue to be shown in this line item as a lump sum was the most important problem that should have been addressed by the new GFE, but wasn't.   I believe this oversight demonstrates the lack of understanding of the mortgage industry and borrower needs by those who were responsible for writing the new GFE standards.   Left to our own devices, without the interference of government dictates, the marketplace will almost always correct itself through either internal pressure of pressure from those customers we serve.    Let the marketplace control the market and keep the artificial influence of the government from continuing to hide the real problems that could truly bring strength back to our business.   www.ratewindow.com

Yep.... I don't think it puts all originators on level playing ground. If you are originating as a bank you still don't have to disclose your rebate (what the bank is paying you). So Banks can still hide a huge portion of what they are earning. I think it will put a kink in the chain for those originators who are low ballers! I anticipate a good month or two until we all get used to this new way of disclosing to the borrower. Lenders, HUD, Brokers, and Banks will all have their own way of interpreting these new disclosures. The biggest problem I have is the borrower is no longer required to sign it. Which is just ridiculous to me! Thanks for the post.

Nice post. I reblogged and think lots of us should reblog to get the info out there.

i can not believe this new stuff...how does the govt think of such stupid stuff....our tax dollars at work

Esko, the lack of a break down makes is a big negative, that really needs to be changed.

Ray thank you, I will try to keep it up.

James you are right, we don't have any choice but to do that.

Colleen, I have done two other blogs after this one so you might want to take a look at them.

Bruce ..... Amen to that!!!

Erin, it is funny that the Borrower has to sign a BLANK page 5 of the 1003, but does not have to sigh the new GFE.  Where is the common sense in all this.

Erica, thank you for helping to spread the word.

Dana I agree!!!

The constant changes just keep us all from being confident about what's going on.

I don't know that this new form will be much better but it certainly creates more questions and confusion.