No Good Faith Estimate Without a Rate Lock?

frustrated “I was just pre-approved for my loan, and although I was assured that I would receive a GFE, when I got my paperwork, I don’t have one. Just the lender’s own loan summary form. Two managers told me they don’t give out GFEs until a rate is locked. Isn’t this against the law? This isn’t the only lender that has told me that they cannot provide a GFE without a rate lock,” wrote a savvy but frustrated lady who’s read my books.

Since a lot of folks are hitting up against this brick wall, I thought it best to answer the question for everyone at the same time.


The short answer is yes, it sounds like they are in violation of the law. I’ll explain.

Effective January 1, 2010, a Good Faith Estimate is required to be issued no later than three  business days after the loan officer has received all of the following:

  • borrower’s full names
  • monthly income
  • social security numbers to obtain a credit report
  • property address
  • estimated value of the property
  • loan amount
  • any other information deemed necessary by the loan originator to complete an application

Receipt of the above items are how Federal banking law (HUD) defines a loan application.

From HUD’s Real Estate Settlement Procedures Act (RSPA) FAQ 23:

An application includes information the loan originator requires the borrower to submit in anticipation of a credit decision. If a loan originator issues a GFE, the loan originator is presumed to have received all six pieces of information.

So we see that a loan officer  can issue a Good Faith Estimate without the rate being locked; and in fact, is required to do so. A rate lock is not borrower information required for a credit decision, so there’s no loophole there.

What’s more, a loan officer must not require your signature before providing the Good Faith Estimate, because that might inhibit you from shopping, which you are fully entitled to. Here’s the quote fro the law.


…a loan originator may not require a borrower to sign consents to verify employment, income or deposits as a condition of issuing a GFE as such a requirement may inhibit borrowers from shopping for the best loan by leading borrowers to believe that they are committed to obtaining a loan from that loan originator.


If you have provided all the information stated above to complete an application, your lender must either issue a Good Faith Estimate within three business days or deny your application.   If they do not, they are violating RESPA. I suggest you refer them to this blog post with a friendly reminder that they probably don’t want to be reported to HUD (U.S. Dept. of Housing and Urban Development), the legal watchdog that is happy–if not eager–to “follow up” on lenders who violate the law.


Personally, I find the Loan Summary/Cost Estimate Worksheet/Initial Fees Worksheet (whatever your lender wants to call it) to be more revealing and more helpful than the new 3-page GFE that the Feds designed, because they show the breakdown of fees better and include more information (such as total monthly payment and cash to close) than the GFE does.

As always, your comments are welcome.