New Good Faith Estimate Form Required by HUD

Beginning January 1, 2010 brokers who arrange federally related mortgage loans must use the new Good Faith Estimate. See HUD’s Web site for more information.

Brokers who previously used the combined Mortgage Loan Disclosure Statement/Good Faith Estimate form, RE 883, must now provide two separate disclosure forms to borrowers when arranging federally related mortgage loans. The RE 882 Mortgage Loan Disclosure Statement and the new Good Faith Estimate required by HUD will together meet the disclosure requirements of the Real Estate Settlement and Procedures Act (RESPA) and the California real estate law. The disclosure forms must be provided to the borrower within 3 days of receipt of a loan application.

The Department is in the process of obtaining HUD’s approval for a combined Mortgage Loan Disclosure Statement/Good Faith Estimate form that can be used by brokers to comply with the state and federal disclosure requirements. The combined form will be made available on the Department’s web site when approval is received from HUD.

Brokers who arrange non-traditional mortgage loans are reminded they must provide borrowers with the Mortgage Loan Disclosure Statement/Good Faith Estimate, RE 885. They must be aware, however, that the Good Faith Estimate portion of the form is no longer sufficient to comply with the new federal requirements. The RE 885 must also be accompanied by the new Good Faith Estimate form for all federally related non-traditional mortgage loans.