In a pricing desk question, a closing coordinator sees facts tied to TILA TRID Disclosures. What should the file reflect?
Correct Answer
A) Use points-and-fees totals before classifying the loan
Why this is correct: Under TILA and TRID, the calculation of "points and fees" is a critical threshold test. The total points and fees determine if a loan is classified as a High-Cost Mortgage (HOEPA) or a Qualified Mortgage (QM), which triggers different disclosure and ability-to-repay requirements. Therefore, the correct action, "Use points-and-fees totals before classifying the loan," is a mandatory step in the pricing and disclosure process to ensure proper loan classification and compliance. Why the other choices are wrong: "Treat the TILA TRID Disclosures review as complete because the file contains a related anti-steering note" is wrong because an anti-steering note relates to a different rule (Loan Originator Compensation) and does not address the points-and-fees calculation necessary for proper disclosure. "Ignore product, occupancy, LTV, or eligibility limits because the borrower prefers the loan" is wrong because points-and-fees thresholds are legal requirements, not preferences. "Use the same treatment for all mortgage products without comparing program requirements" is wrong because points-and-fees calculation rules can differ slightly between loan types (e.g., QM vs. non-QM). Exam tip: Points and fees are a gateway calculation. Always calculate them first to determine the correct loan classification and applicable rules.
Why This Is the Correct Answer
The correct response is "Use points-and-fees totals before classifying the loan" because Points and fees can affect APR, HOEPA, QM, and borrower cost calculations.
Why the Other Options Are Wrong
Option B: Treat the TILA TRID Disclosures review as complete because the file contains a related anti-steering note.
This distractor shifts the issue to a different trigger, product, or timing rule instead of applying the rule tested in the stem.
Option C: Ignore product, occupancy, LTV, or eligibility limits because the borrower prefers the loan.
Ignore product, occupancy, LTV, or eligibility limits because the borrower prefers the loan. is not correct because it does not apply the rule tested by this file scenario.
Option D: Use the same treatment for all mortgage products without comparing program requirements.
Use the same treatment for all mortgage products without comparing program requirements. is not correct because it does not apply the rule tested by this file scenario.
Memory Technique
points and fee calculations: 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 points and fee calculations; 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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