For third-party services where the borrower is permitted to shop, what is the tolerance level if the borrower selects a provider from the lender's written list?
Correct Answer
B) 10% cumulative tolerance
When a borrower selects a third-party service provider from the lender's written list of providers, those charges are subject to the 10% cumulative tolerance, not zero tolerance. This gives borrowers shopping flexibility while maintaining some cost predictability.
Why This Is the Correct Answer
When a borrower selects a third-party service provider from the lender's written list of providers, those charges are subject to the 10% cumulative tolerance, not zero tolerance. This gives borrowers shopping flexibility while maintaining some cost predictability.
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Previous Question
A borrower wants to refinance their 4.5% fixed-rate mortgage to access $75,000 in home equity for their child's college tuition. The new loan would be at 5.0%. Which statement is most accurate regarding tangible net benefit?
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When providing a list of settlement service providers to a borrower, the MLO must: