An MLO receives an application where the borrower provides their loan amount as '$300,000 approximately - depends on final property value.' No specific loan amount is given. What should the MLO do regarding application completeness?
Correct Answer
A) Request a specific loan amount to complete the application
Under TRID, the loan amount must be specific enough to allow for accurate disclosure preparation. An approximate amount 'depending on final property value' is too vague and doesn't provide sufficient information for the lender to prepare accurate disclosures. A specific loan amount is required for application completeness.
Why This Is the Correct Answer
Under TRID, the loan amount must be specific enough to allow for accurate disclosure preparation. An approximate amount 'depending on final property value' is too vague and doesn't provide sufficient information for the lender to prepare accurate disclosures. A specific loan amount is required for application completeness.
More Mortgage Knowledge Questions
A borrower refinances their home with a cash-out refinance loan of $750,000. The original loan balance was $400,000, and they're taking $300,000 in cash. If conforming limits allow $766,550, how is this loan classified?
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?
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?
Under TRID regulations, discount points must be disclosed on the Loan Estimate in which section?
A borrower is refinancing a $350,000 property. The existing first mortgage balance is $200,000, and they want to take $75,000 cash out. What will be the new LTV ratio?
During the draw period of a HELOC, what type of payments are borrowers typically required to make?
A borrower submits a loan application but fails to provide their Social Security number, claiming privacy concerns. The MLO has obtained the borrower's name, income, estimated property value, loan amount, and property address. According to TRID regulations, what is the status of this submission?
A borrower has a 5/1 ARM with an initial rate of 3.5%. The loan uses the 1-year Treasury index, which is currently at 2.0%, and has a margin of 2.75%. What will the borrower's new interest rate be at the first adjustment, assuming no rate caps apply?
A borrower's homeowners insurance policy is cancelled mid-term due to non-payment, but the escrow account shows the premium was paid. Investigation reveals the insurance company applied the payment to a different policy number. What should the servicer do?
A lender packages a $500,000 conventional loan that meets all current GSE standards but was originated using outdated underwriting software that didn't verify employment in the required manner. This loan would be:
People Also Study
Federal Mortgage-Related Laws
24% of exam
Mortgage Loan Origination Activities
27% of exam
Ethics, Fraud & Consumer Protection
18% of exam
Uniform State Test Content
11% of exam
Related Study Resources
Previous Question
What is the primary purpose of discount points in mortgage lending?
Next Question
A borrower has two mortgages on their property: a first mortgage of $200,000 and a second mortgage of $75,000. They want to refinance only the first mortgage to $210,000 for better terms, leaving the second mortgage in place. How is this transaction classified?