Survey: Homebuyers Don't Get Good Faith Estimate

good faith estimate
good faith estimate

A new survey reveals that more than half of homebuyers today don't know what the Good Faith Estimate is actually good for - namely, to shop around for the cheapest mortgage loans on the market.

In a survey released by ING Direct on Wednesday, 56 percent of respondents did not use the GFE to compare lenders' associated closing costs. One in 10 respondents have never even reviewed the document, which lenders must provide within three days of a loan application.

Consumers' continued indifference toward the three-page disclosure comes after recent (and painstaking) efforts to simplify the information for homebuyers. Under the Real Estate Settlement and Procedures Act (RESPA), the Good Faith Estimate was streamlined to give buyers a straightforward look at the special sauce that goes into every home loan. The form itemizes settlement costs, from expected title insurance costs to home inspection fees and taxes. You can download a sample GFE from the Department of Housing and Urban Development (HUD) here.