The Good Faith Estimate, or GFE was intended to protect the buyer by documenting all the fees that need to be paid by a buyer at closing.
The fees at closing cannot differ more than 10% of what was quoted, and if it is more, the lender is liable for the difference. This was put in place to keep lenders honest. Previously, cost estimates would be massaged in order to lure a borrower away from the competition, and when it came time to pay up at closing the actual fees could be substantially more.
Some lenders are getting around this requirement by issuing work sheets, and loan scenario forms which are not legally binding. They can effectively do this if an application is incomplete, either because the lender did not ask for the information or the borrower did not fill it in correctly, either innocently or on purpose, thus per HUD’s definition, this is not an application.
Lenders are loathe to issue a hard and fast estimate as they cannot be 100% sure of actual closing costs. They feel the worksheet gives a good idea of the final costs. However, if you would like a clear picture of those final fees, insist on a GFE. It is a binding document and you will have no surprises come closing time.