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GFE refers to expenses associated with your loan only. The HUD is ALL expenses associated with the purchase. So the GFE expenses will show up on the HUD. The 10k contribution to the 2nd lien holder is not on the GFE. It is in section 100 of the HUD.
So if you are buying this house for 100k and you are putting 20% down and your closing cost from GFE is 3k and you are giving 10k to the 2nd lien holder you will need 33k to close (20k down + loan costs of 3k + 10k for 2nd lien holder).
If you shoot me your GFE, I can tell you how much cash you need to close. My e-mail is [email protected]. I uploaded a master HUD (Showing buyer and seller side) where buyer contributed to 2nd lien. The only difference is this was a cash transaction so most GFE fields on the HUD will be blank.
Thank you Satar. So what you are saying is that the contribution does not have to show up on the GFE and only on the HUD which will show everything. Currently my GFE states that my estimate is about 11K, but I know that I'll need an additional 10K at closing to cover the contibution to the second. Then technically, the GFE will not include all the extras that the HUD will cover in terms of costs outside of the loan itself. Is this correct? I'm starting to feel much better! You guys are such a tremendous help.
you are correct. So you need 11k plus the 10k plus your down payment. Please let me know if you have any further questions.
Sorry the GFE should have an "Total estimated funds to close" which should include your down payment and closing cost. So you need 22k total to close.
My closer at First American title says this:
This is my thinking. It’s not a “fee” related to the lending of the funds ie: origination, tax service, apprl, credit report. And an LO is required to disclose what “closing cost” are being charged in conjunction with obtaining a mortgage. Any other charges, such as credit card debt/ bad debt and things like that would be charges that are out of the realm of “closing cost” or at least I would think so as they are simply payoffs of debt or in this case an agreement to help assist the seller with their debt and unrelated to a “fee” the bank is charging to loan money.
Awesome exchange of information! You all rock!
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