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What is a Good Faith Estimate (GFE)? - Definition of the Good Faith Estimate

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The Good Faith Estimate:

A good faith estimate is a statement showing the ballpark costs a lender will charge you. While some people think a good faith estimate is a firm quote, there's plenty of wiggle room in those prices.

In any case, you get a decent idea of what you'll be paying with a good faith estimate.

Limitations of the Good Faith Estimate:

Is the good faith estimate a firm promise? Not even close. None of the prices are guaranteed, and some of the prices are wild guesses. Your lender includes costs that they don't charge or have any control over.

In addition, your interest rate can change from what is quoted on the good faith estimate. A good faith estimate from an honest broker is about as good as you can get. A good faith estimate from a less-than-honest lender doesn't do you any good.

Using Good Faith Estimates:

 

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