Here are the GFE requirements from RESPA:
TITLE 24--HOUSING AND URBAN DEVELOPMENT
CHAPTER XX--OFFICE OF ASSISTANT SECRETARY FOR HOUSING--FEDERAL HOUSING
COMMISSIONER, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
PART 3500--REAL ESTATE SETTLEMENT PROCEDURES ACT--Table of Contents
Sec. 3500.7 Good faith estimate.
(a) Lender to provide. Except as provided in this paragraph (a) or
paragraph (f) of this section, the lender shall provide all applicants
for a federally related mortgage loan with a good faith estimate of the
amount of or range of charges for the specific settlement services the
borrower is likely to incur in connection with the settlement. The
lender shall provide the good faith estimate required under this section
(a suggested format is set forth in appendix C of this part) either by
delivering the good faith estimate or by placing it in the mail to the
loan applicant, not later than three business days after the application
is received or prepared.
(1) If the lender denies the application for a federally related
mortgage loan before the end of the three-business-day period, the
lender need not provide the denied borrower with a good faith estimate.
(2) For ``no cost'' or ``no point'' loans, the charges to be shown
on the good faith estimate include any payments to be made to affiliated
or independent settlement service providers. These payments should be
shown as P.O.C. (Paid Outside of Closing) on the Good Faith Estimate and
the HUD-1 or HUD-1A.
(3) In the case of dealer loans, the lender is responsible for
provision of the good faith estimate, either directly or by the dealer.
(4) If a mortgage broker is the exclusive agent of the lender,
either the lender or the mortgage broker shall provide the good faith
estimate within three business days after the mortgage broker receives
or prepares the application.
(b) Mortgage broker to provide. In the event an application is
received by a mortgage broker who is not an exclusive agent of the
lender, the mortgage broker must provide a good faith estimate within
three days of receiving a loan application based on his or her knowledge
of the range of costs (a suggested format is set forth in appendix C of
this part). As long as the mortgage broker has provided the good faith
estimate, the funding lender is not required to provide an additional
good faith estimate, but the funding lender is responsible for
ascertaining that the good faith estimate has been delivered. If the
application for mortgage credit is denied before the end of the three-
business-day period, the mortgage broker need not provide the denied
borrower with a good faith estimate.
(c) Content of good faith estimate. A good faith estimate consists
of an estimate, as a dollar amount or range, of each charge which:
(1) Will be listed in section L of the HUD-1 or HUD-1A in accordance
with the instructions set forth in appendix A to this part; and
(2) That the borrower will normally pay or incur at or before
settlement based upon common practice in the locality of the mortgaged
property. Each such estimate must be made in good faith and bear a
reasonable relationship to the charge a borrower is likely to be
required to pay at settlement, and must be based upon experience in the
locality of the mortgaged property. As to each charge with respect to
which the lender requires a particular settlement service provider to be
used, the lender shall make its estimate based upon the lender's
knowledge of the amounts charged by such provider.
(d) Form of good faith estimate. A suggested good faith estimate
form is set forth in appendix C to this part and is in compliance with
the requirements of the Act except for any additional requirements of
paragraph (e) of this section. The good faith estimate may be
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provided together with disclosures required by the Truth in Lending Act,
15 U.S.C. 1601 et seq., so long as all required material for the good
faith estimate is grouped together. The lender may include additional
relevant information, such as the name/signature of the applicant and
loan officer, date, and information identifying the loan application and
property, as long as the form remains clear and concise and the
additional information is not more prominent than the required material.
(e) Particular providers required by lender. (1) If the lender
requires the use (see Sec. 3500.2, ``required use'') of a particular
provider of a settlement service, other than the lender's own employees,
and also requires the borrower to pay any portion of the cost of such
service, then the good faith estimate must:
(i) Clearly state that use of the particular provider is required
and that the estimate is based on the charges of the designated
provider;
(ii) Give the name, address, and telephone number of each provider;
and
(iii) Describe the nature of any relationship between each such
provider and the lender. Plain English references to the relationship
should be utilized, e.g., ``X is a depositor of the lender,'' ``X is a
borrower from the lender,'' ``X has performed 60% of the lender's
settlements in the past year.'' (The lender is not required to keep
detailed records of the percentages of use. Similar language, such as
``X was used [regularly] [frequently] in our settlements the past year''
is also sufficient for the purposes of this paragraph.) In the event
that more than one relationship exists, each should be disclosed.
(2) For purposes of paragraph (e)(1) of this section, a
``relationship'' exists if:
(i) The provider is an associate of the lender, as that term is
defined in 12 U.S.C. 2602(8);
(ii) Within the last 12 months, the provider has maintained an
account with the lender or had an outstanding loan or credit arrangement
with the lender; or
(iii) The lender has repeatedly used or required borrowers to use
the services of the provider within the last 12 months.
(3) Except for a provider that is the lender's chosen attorney,
credit reporting agency, or appraiser, if the lender is in an affiliated
business relationship (see Sec. 3500.15) with a provider, the lender may
not require the use of that provider.
(4) If the lender maintains a controlled list of required providers
(five or more for each discrete service) or relies on a list maintained
by others, and at the time of application the lender has not yet decided
which provider will be selected from that list, then the lender may
satisfy the requirements of this section if the lender:
(i) Provides the borrower with a written statement that the lender
will require a particular provider from a lender-controlled or -approved
list; and
(ii) Provides the borrower in the Good Faith Estimate the range of
costs for the required provider(s), and provides the name of the
specific provider and the actual cost on the HUD-1 or HUD-1A.
(f) Open-end lines of credit (home-equity plans) under Truth in
Lending Act. In the case of a federally related mortgage loan involving
an open-end line of credit (home-equity plan) covered under the Truth in
Lending Act and Regulation Z, a lender or mortgage broker that provides
the borrower with the disclosures required by 12 CFR 226.5b of
Regulation Z at the time the borrower applies for such loan shall be
deemed to satisfy the requirements of this section.
(Approved by the Office of Management and Budget under control number
2502-0265)
[61 FR 13233, Mar. 26, 1996, as amended at 61 FR 58476, Nov. 15, 1996]
