Can a loan originator request verification without a GFE?
In January, HUD advised that a loan originator could not ask a consumer to provide verification documents or an authorization permitting the loan originator to verify employment, income or deposits, without first providing the consumer with a GFE. HUD’s position created a problem for buyers who had not yet identified a property to purchase but had requested prequalification letters from their loan originators. In April, HUD clarified its position: If a loan originator is missing one of the elements required for a loan application, such as a property address, and is not required to provide a GFE, the originator may verify information for which the consumer voluntarily provides documentation. HUD’s new approach should assist loan originators with the preapproval/prequalification process. Will HUD’s formal guidance on prequalifications and preapprovals match its informal guidelines? In April, HUD answered the following two questions, which were designed to resolve the ambiguity between it
Related Questions
- Does a loan originator have to show an appraisal fee (or other fee) paid to a third party on the GFE and HUD-1 even if the loan originator wants to cover 100% of the fee?
- If there is a changed circumstance,. when does the loan originator issue a new GFE?
- Can a loan originator e-mail a GFE to a borrower?
