An MLO receives an application where the borrower provides their gross monthly income as $8,000 but later clarifies this represents their annual income, not monthly. The borrower's actual monthly income is $667. How should the MLO handle this situation regarding the application date?
Correct Answer
B) A new application date is established when the corrected income is received
Under TRID, the application date is established when all six pieces of required information are received in a form that is reasonably reliable. Since the income was materially incorrect and unreliable, a new application date is established when the corrected, reliable income information is received.
Why This Is the Correct Answer
Under TRID, the application date is established when all six pieces of required information are received in a form that is reasonably reliable. Since the income was materially incorrect and unreliable, a new application date is established when the corrected, reliable income information is received.
More Mortgage Knowledge Questions
A borrower is comparing two loan offers: Loan A has no points and 4.5% interest rate, Loan B has 2 points and 4.0% interest rate. The loan amount is $400,000. How much will the borrower pay upfront for the points on Loan B?
A lender charges a 1% origination fee on all loans. For a borrower obtaining a $250,000 mortgage, what is the maximum origination fee that can be charged without violating the points and fees test under the ATR/QM rule for a first-lien mortgage?
Under what circumstances can a Qualified Mortgage include a prepayment penalty?
A borrower is considering paying discount points to reduce their interest rate. Each point costs 1% of the loan amount and reduces the rate by 0.25%. On a $300,000 loan, how much would the borrower pay for 2 discount points?
A borrower asks about the difference between discount points and origination fees. What is the most accurate explanation?
People Also Study
Federal Mortgage-Related Laws
23% of exam
Mortgage Loan Origination Activities
25% of exam
Ethics, Fraud & Consumer Protection
17% of exam
Uniform State Test Content
12% of exam
Previous Question
A lender charges a 1% origination fee on all loans. For a borrower obtaining a $250,000 mortgage, what is the maximum origination fee that can be charged without violating the points and fees test under the ATR/QM rule for a first-lien mortgage?
Next Question
A lender originates a $400,000 conventional loan that meets all GSE guidelines except it has a 45% debt-to-income ratio when the maximum allowed is 43%. This loan would be classified as: