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In 1974, the United State Congress enacted the Real Estate Settlement Procedures Act (RESPA), a federal consumer protection law, which is administered and enforced by the Consumer Financial Protection Bureau (CFPB). RESPA requires lenders to provide a good faith estimate (GFE) for all the approximate costs of a particular loan and finally a HUD-1 (for purchase real estate loans) or a HUD-1A (for refinances of real estate loans) at the closing of the real estate loan. The final HUD-1 or HUD-1A allows the borrower to know specifically the costs of their loan. In addition, the Federal Reserve Board requires lenders to provide borrowers a Truth in Lending (TIL) disclosure with all the specifics of a loan. These mortgage disclosures are only for home equity lines of credit, reverse mortgages, mortgages secured by a mobile home, or a dwelling not attached to the land. For other residential loan types see (TRID - Mortgage Loan Disclosure).
A Good Faith Estimate (GFE) is a document prepared and issued by a lender, when applying for a loan that provides you with an advance estimate of your settlement charges and loan terms.
A Truth in Lending (TIL) is a disclosure prepared by a lender to provide standardized information so that borrowers can compare loan terms.
A HUD -1 Statement is a document prepared by a closing agent describing a real estate transaction, including the escrow deposits for taxes, commissions, loan fees, points, hazard insurance, and mortgage insurance. also called closing statement or settlement sheet.
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