Anatomy of the OLD Good Faith Estimate, now called a Fees Worksheet:
The Fees Worksheet is designed to inform you of the fees associated with your transaction. Unfortunately, the form omits some very valuable and imprtant information that can be found on the new GOOD FAITH ESTIMATE 2010.
You will find that there are fees charged by the lender, broker, investor/bank, Title Company, appraiser, surveyor and a number of other items that are estimated for you on this one document. The loan origination, processing fee and administrative fee are from my company. All other fee’s are provided by other entities to us and are a straight pass through cost to the borrower.
The appraisal fee is included on the HUD1 settlement statement although to expedite return of your appraisal, we as that you “secure” payment with your credit car in advance. This should be done as soon as your application and disclosures are signed and returned.
The title company charges are estimated on their behalf are what is considered to be usual and customary fees will be. Title Insurance is state regulated and is based on the Loan amount and the price or value of the home. It will not vary from one Title Company to another. The escrow fee and other smaller fees may vary slightly and I have intentionally inflated them for your best interests.
The survey is paid directly to the survey company by the title company and is then charged to you IF a new survey is needed. If a suitable survey can be provided a new survey is not required and there is no charge. Who pays for the survey is defined on the contract for sale if a purchase or to the homeowner in a refinance.
The reserves and prepaid series of numbers are to set up your “escrow” account to ensure there is a sufficient reserve to pay for taxes and insurance when due. Not all loan types require an escrow account, so this may vary on your Fees Worksheet. On a purchase, on year prepaid insurance is required and for most refinances, a minimum or 3-6 months proof of prepaid insurance is required.
The final section is a summary. All of the “charges” are in the far left hand column which include things like the Purchase price or Payoff amount, closing costs, settlement charges and the like. The middle column under this section are all of the credits like loan amount, seller paid contributions, Earnest money and things of that nature. The final column on the right is a total of the monthly payments.
Finally, at the bottom of the page you’ll find the phrase “Funds need to close” and you see the actual amount you will need to bring to your closing. Unfortunately, you will not ever see where the “down-payment” is listed on a purchase transaction. Rest assured that it is included because of the way the form is laid out. All credits on one side, all debits in the other and the difference includes any down-payment required.
Please call me to review your Initial Fees Worksheet.
