Obtaining Committment from Lender on Point & Fee Reduction (loan, pre-approval, credit)

[BNR_1]

Hi everyone. I recently I spoke to a lender (large banking institution) about a possible loan for a home purchase. This would be for a 30-year fixed, conforming, 80% LTV ratio loan. At present I haven’t found a home so my initial quest is to obtain a pre-approval letter and begin shopping.

I asked the lender what today’s rates (last week) are and the discount points. She provided this information along with the banking fee. Because the call from the lender was through a referral, the lender offered to waive a 0.25% reduction from the discount point and she may waive the banking fee charge should I decide to go with this lender.

My question is how do I get a formal commitment from the lender for the reduction in the discount point and banking fee? Since I do not have a home in mind I do not want to go through the process of obtaining a pre-approval with this lender thinking that I may have lower fees only to discover when I actually go through the loan process it isn’t so. Is it typical to obtain a GFE for a pre-approval?

Thank you

[2bindenver]

Don't get frustrated if your lender can't provide a GFE. In order to provide the new 2010 GFE, the lender must have:

P Property Address
E Estimated Value
N Name
C Credit
I Income
L Loan Amount

Without ALL of the required data, the lender cannot provide a Good Faith Estimate. Once we have all of the above, the lender MUST provide the Good Faith Estimate within 3 days.

So how can borrowers compare lenders? Prospective home buyers should be asking for the Initial Fees Worksheet (this is the Good Faith Estimate as you know it from last year).

Also, be careful regarding seller paid closing costs. The new Good Faith Estimate requires the lender to disclose the owner's title policy as a buyer expense, so this inflates closing costs on the new Good Faith Estimate.

Bottom line. . . the total closing costs will still reflect this cost, so you could inadvertently request too much money in seller paid closing costs. . . money that could ultimately remain in the seller's hands.