West Virginia Mortgage Law Test 2025 – 400 Free Practice Questions to Pass the Exam

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Why is a good faith estimate critical for borrowers?

It can negotiate better pricing for the home

It allows the lender to charge arbitrary fees

It helps borrowers understand final costs in the mortgage process

A good faith estimate is critical for borrowers because it provides a clear and transparent overview of the anticipated costs associated with obtaining a mortgage. This document outlines various expenses such as loan origination fees, closing costs, and other charges that the borrower can expect to encounter during the mortgage process. By receiving this estimate early on, borrowers can make informed decisions and prepare financially for the upcoming expenses.

Furthermore, the good faith estimate fosters a sense of trust and accountability between the borrower and the lender, ensuring that the lender does not suddenly impose unexpected charges. Understanding these final costs can help borrowers compare different mortgage offers, budgeting for their financial commitments, and ultimately deciding which loan best fits their needs. This clarity and transparency are essential for protecting borrowers’ interests as they navigate the mortgage landscape.

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It provides a fixed interest rate guarantee

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