Officials Set Parameters for Worksheet Use with New GFE

Lenders can use worksheets with the new good-faith estimate to provide information to mortgage applicants that is not disclosed in the GFE, according to the Department of Housing and Urban Development. "A loan officer may use a worksheet to provide the consumer with additional information about his or her loan transaction, such as the amount of cash needed at closing, seller credits and other non-loan transaction fees that would be helpful to the consumer," HUD says in an update of its "Frequently Asked Questions" on the Real Estate Settlement Procedures Act rule that went into effect Jan. 1. HUD warns, however, that the worksheet should not look like the GFE and a loan originator should "never" use a worksheet in lieu of a GFE. The new RESPA rule makes it very difficult for lenders to change their origination fee once the GFE is given to a mortgage applicant. HUD officials were suspicious of worksheets at first because the estimates of lender fees and settlement costs would not be enforceable under the RESPA rule. But now "HUD is acknowledging these documents have their place," said RESPA attorney Phillip Schulman, a partner at K&L Gates.