A creditor issued an unlocked Loan Estimate. Five days later, the consumer and creditor enter into a rate-lock agreement. What must the creditor generally provide?

Correct Answer

B) A revised Loan Estimate within three business days reflecting the locked rate and rate-dependent charges

Why this is correct: Under TRID rules, an initial Loan Estimate is often issued with an "unlocked" or floating interest rate. When the consumer later enters into a rate-lock agreement, this is a significant event that changes the terms of credit. As the original explanation states, the creditor must generally provide a revised Loan Estimate within three business days of the rate lock. This revised LE must reflect the now-locked interest rate and all terms dependent on that rate, such as points, lender credits, and adjusted closing costs, ensuring the consumer has accurate, binding figures before proceeding. Why the other choices are wrong: "A new mortgage application" is wrong because locking a rate does not require restarting the entire application process; it is a modification of terms within the existing application. "Only an oral confirmation at closing" is wrong because TRID requires written disclosures; oral confirmation does not satisfy the legal requirement to provide a revised, written Loan Estimate. "A Closing Disclosure on the same day regardless of the closing date" is wrong because the timing for the Closing Disclosure is tied to the closing date (at least three business days before consummation), not the rate-lock date, and a revised LE is the required next step after a lock. Exam tip: Key trigger: Rate lock after initial LE = Revised LE within 3 business days. The clock starts when the agreement is made.