page 1 of GFE:
1. Summary of your loan - Interest rate, term of loan, monthly PITI payment
2. Summary of settlement charges - origination fee (lender fee) and settlement services
page 2 of GFE:
3. Understanding you estimated settlement charges - this will show the lender fee (every lender has a lender fee) and if they are charging you "points" for the rate they gave you. I have found time and time again $1000 charges here for higher rates then the rate I gave with no points.
4. Description of your settlement services - here is the list of charges for appraisal fee, credit report, flood certification , mortgage insurance, condo fees, second mortgage subordination fees etc.
page 3 of GFE
5. Explaination of fees that can chage, will not chage and the HUD -1 you will get at closing.
The GFE will not show you if the lender is giving you a lender credit to help cover your lender fees and settlement charges. I typically try and give my borrowers as much lender credit as I can with the lowest interest rate. As I metioned in the above descriptions, all lenders have lender fees, they may just charge you a higer rate or charge points to cover their costs.
Some additional notes about charges:
Appraisal - this is a service that the Lender must disclose the charge as they have to order it from an unbiased appraisal desk. This is typically a fee a lender will charge upfront and can only charge you the actual cost of the appraisal.
Lender fee - what the lender charges to originate the loan, typically lender fee and process fee. Guaranteed Rate is $840 plus a processing fee of $150. If they say they don't have a lender fee, then look at the points they are charging you for the rate they gave you! Or if they say it's a no cost loan, look at the rate and the APR (average percentage rate of the life of the loan includes interest rate and the cost of doing the loan)
Please feel free to call me to discuss or get a quote!
Mary Kay Laurent
Vice President of Mortgage Lending
o: 773.516.6859 / m: 312.403.4150 / f: 773.516.6014
3940 North Ravenswood , Chicago, IL 60613
NMLS ID: 870598
State License Numbers: CA - CA-DOC870598 - 4130699, IL - 031.0032236 - MB.0005932, WA - MLO-870598 - CL-2611