A borrower’s written request for the name of the owner of his loan arrives at the servicer’s designated address on Monday 3 March. A representative diarises the acknowledgment for Friday 7 March. Is that in time?
Correct Answer
C) Acknowledge receipt within five business days
Why this is correct: Under Regulation X (RESPA), 12 CFR 1024.36(c), a servicer must acknowledge a borrower's written request for information (a "Notice of Error" or "Request for Information") within five business days of receipt. This acknowledgment is a mandatory procedural step. Why the other choices are wrong: "Document that RESPA reg x was reviewed, but take no required corrective action" is wrong because merely reviewing the rule without performing the required action (the acknowledgment) is non-compliant. "Use an informal exception and leave the required record unchanged" is wrong because there is no informal exception to this timing rule; the acknowledgment must be sent. "Let production goals override the required verification, disclosure, license, or record step" is wrong because business pressures never justify skipping a mandatory federal requirement. Exam tip: Memorize key Regulation X timelines. The 'five-day acknowledgment' for information requests is a frequently tested item.
Why This Is the Correct Answer
The correct response is "Acknowledge receipt within five business days" because Lines 33-41; 12 CFR 1024.36(c).
Why the Other Options Are Wrong
Option A: Document that RESPA reg x was reviewed, but take no required corrective action.
Document that RESPA reg x was reviewed, but take no required corrective action. is not correct because it does not apply the rule tested by this file scenario.
Option B: Use an informal exception and leave the required record unchanged.
Use an informal exception and leave the required record unchanged. is not correct because it does not apply the rule tested by this file scenario.
Option D: Let production goals override the required verification, disclosure, license, or record step.
Let production goals override the required verification, disclosure, license, or record step. is not correct because it does not apply the rule tested by this file scenario.
Memory Technique
RESPA and Regulation X: identify the rule being tested, then choose the action that documents or applies that rule before the file moves forward.
Exam Tip
Match the file facts to RESPA and Regulation X; do not choose an exception or shortcut that skips the required rule.
Common Mistakes to Avoid
- -Choosing an internal exception instead of the governing rule
- -Treating preliminary or informal facts as a substitute for required documentation
- -Answering from a familiar but unrelated mortgage topic
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