Renting Versus Buying in a Real Estate Down Market

I met yesterday with two of my favorite clients. They recently closed on and moved into a new home. They were fortunate that they were not required to sell their current condo in order to qualify to purchase their new house.

The problem? After many months on the market, their home has not sold. They came to me looking for advice about the possibility of renting out their condo. They were smart to ask.

Lender Deviations from the New Good Faith Estimate

In an effort to reduce consumer confusion when it comes to obtaining a loan, the federal government enacted reforms to the Department of Housing and Urban Development began, on January 1, 2010, to require the use of a standardized form of Good Faith Estimate (GFE).  The concept behind the reform makes sense, but in reality, not much has changed.

The charges on a good faith estimate are now broken into three parts. The first part contains fees that CANNOT change. These are your lender fees. The goal is to impair a lender's attempts to pull a bait and switch on a borrower.  There is no tolerance for any deviation between this part of the terms of the good faith estimate and the actual costs at closing.