A borrower receives a Loan Estimate on January 5th. On January 12th, the lender discovers the borrower has an additional property not disclosed on the application. The lender provides a revised Loan Estimate on January 16th. Is this timing compliant?
Correct Answer
B) No, the revised estimate should have been provided by January 15th
Under 12 CFR 1026.19(e)(3)(iv), when a changed circumstance occurs (undisclosed property affecting creditworthiness), the lender must provide a revised Loan Estimate within 3 business days of receiving information sufficient to establish the circumstance. From January 12th discovery, the deadline would be January 15th (3 business days later).
Why This Is the Correct Answer
Under 12 CFR 1026.19(e)(3)(iv), when a changed circumstance occurs (undisclosed property affecting creditworthiness), the lender must provide a revised Loan Estimate within 3 business days of receiving information sufficient to establish the circumstance. From January 12th discovery, the deadline would be January 15th (3 business days later).
More Origination Questions
A borrower has a construction-to-permanent loan with a 12-month construction phase. At month 10, construction is only 60% complete due to delays. What is the most likely outcome?
For a construction-to-permanent loan, when must the initial Closing Disclosure be provided for the construction phase?
During a refinance transaction, the appraiser determines that significant unpermitted additions were made to the property. The appraiser wants to discuss this with the MLO before finalizing the report. What should the MLO do?
An appraiser discovers that a property has significant foundation issues that were not disclosed. The appraiser reduces the property value by $25,000 and includes detailed comments about the structural problems. The loan officer is upset because this will kill the deal. Under AIR, the loan officer:
An MLO's compensation structure includes higher payments for certain loan products. When is it acceptable to recommend these higher-compensated products?
People Also Study
Federal Mortgage-Related Laws
23% of exam
General Mortgage Knowledge
23% of exam
Ethics, Fraud & Consumer Protection
17% of exam
Uniform State Test Content
12% of exam
Previous Question
A borrower requests a copy of their appraisal report 5 days after loan closing. The lender had provided an appraisal summary during the loan process but not the full report. What is the lender's obligation?
Next Question
Under Dodd-Frank, a mortgage lender is prohibited from paying an MLO compensation that is based on: