In case you hadn’t heard – and why would you be paying attention to this stuff, right? – the Department of Housing and Urban Development has introduced a new Good Faith Estimate that will enter the real estate transaction on January 1 2010, and in my opinion it does a great job of breaking out the real estate transaction.

See, the Good Faith Estimate should reflect every penny in the transaction.  But hidden in the line items are various fees and expenses charged by a lender – invariably, Lender A calls some things different than Lender B, while Lender B calculates things differently than Lender C, and no one seems to have the code necessary to unlock the secrets held in the hidden vault.

Until now.  This Good Faith Estimate does a good job of simplifying and explaining the various charges associated with the transaction.  The Summary of Loan Charges is clear and distinct, the Trade-Off Table shows the relationship between higher/lower rates and the subsequent payment/closing fees, and I like the overall Summary, as well.  The whole thing is a major improvement, I think.

You can download the new form from the HUD website and read through it (to me, and I’m weird but that can be discussed in a later post, this is great bedtime reading) at your leisure.  If you’re in the process of buying a home, or currently getting a loan pre-approval, I’d be interested to know whether your lender has (a) seen the new Good Faith Estimate form, and (b) is willing to compare their current form to this new one.  If you’re willing to take it in to them and ask them those two things, I’d be interested in hearing their response.