Today it was announced that HUD has adopted a new 3 page Good Faith Estimate as part of its RESPA reform package that will be standard among all lenders and go into effect in January of 2010.
The new standard Good Faith Estimate is part of a RESPA Reform package that has been in the works for years. Before the announcement, HUD reviewed approximately 12,000 comments and in considering these comments made changes to what was going to be a 4 page Good Faith Estimate.
According to Brian Montgomery, HUD’s Assistant Secretary of Housing:
“We have carefully considered the concerns expressed from every corner of the mortgage market in developing this rule. I am convinced that we successfully balanced the needs of consumers with those in the business of homeownership. None of us can lose sight of the fact that millions of Americans simply don’t understand all the fine print of their mortgages and this, in many respects, is at the heart of today’s mortgage crisis.”
Personally? I think it is a good idea. It will help standardize information that the consumer is getting from different lenders so that the consumer can make an informed choice and more easily match up the Good Faith Estimate with the Final HUD-1.