An underwriter documents income, employment, the monthly payment on this loan, mortgage-related obligations, current debts including a $340 child support order, and the debt-to-income ratio. She does not pull anything on a second mortgage the borrower is taking at closing. Which required ability-to-repay factor is missing because the simultaneous second mortgage was not evaluated?
Correct Answer
B) Incomplete: the payment on any simultaneous loan is 1 of the 8 factors
The monthly payment on a simultaneous loan is one of the eight factors a creditor must consider, precisely because two closings on the same day can leave a borrower who qualified for neither. Other choices: another creditor underwriting its own file does not relieve this one; there is no rule that six factors will do, since all eight are required; and the value of the dwelling is expressly excluded from the income and assets the creditor may rely on, so leaving it out is correct. Source: 12 CFR 1026.43(c)(2)
Why This Is the Correct Answer
The monthly payment on a simultaneous loan is one of the eight factors a creditor must consider, precisely because two closings on the same day can leave a borrower who qualified for neither. Other choices: another creditor underwriting its own file does not relieve this one; there is no rule that six factors will do, since all eight are required; and the value of the dwelling is expressly excluded from the income and assets the creditor may rely on, so leaving it out is correct. Source: 12 CFR 1026.43(c)(2)
More Origination Questions
Before the team acts on a servicing handoff check, a closing coordinator must address Asset Verification and Reserves. Which response is most defensible?
An MLO is reviewing procedures for a case where a cost changes after the Closing Disclosure has already been provided. What is the proper handling?
During a post-application update, a quality-control reviewer encounters a Credit Analysis and Evaluation issue. Which response should avoid a shortcut that would misapply the rule?
Between the Loan Estimate and closing, prepaid interest increases $180, homeowner insurance increases $95, transfer taxes increase $40, and a credit report fee for which the consumer could not shop increases $12. There is no valid revised estimate or other exception. Which increases violate TRID's zero-tolerance rule?
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Before closing, the team discovers that a borrower asks which upfront charge can be collected before intent to proceed. What is the safest compliant answer?
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Before releasing the final construction draw, which combination most directly supports project completion and clear collateral?
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