Good Faith Estimate is a document provided by the lender to the borrower, outlining estimated costs and fees associated with the mortgage loan.
The Good Faith Estimate (GFE) was a document that was used in the United States prior to October 3, 2015. It was replaced by two new forms as part of the TILA-RESPA Integrated Disclosure (TRID) rule, which was implemented by the Consumer Financial Protection Bureau (CFPB).
The two new forms that replaced the GFE are the Loan Estimate (LE) and the Closing Disclosure (CD). The Loan Estimate is provided by the lender to the borrower within three business days of receiving a mortgage loan application. It provides detailed information about the loan terms, estimated closing costs, and other important aspects of the mortgage loan.
The Closing Disclosure, on the other hand, is provided to the borrower at least three business days before the loan closing. It provides the final terms of the loan, the actual closing costs, and a side-by-side comparison of the Loan Estimate and the final costs.
Both the Loan Estimate and the Closing Disclosure are designed to provide borrowers with clear and accurate information about their mortgage loan terms and costs. They aim to help borrowers understand the financial implications of their loan and make informed decisions.