What is the maximum waiting period before flood insurance coverage becomes effective for a newly purchased policy?
Correct Answer
B) 30 days
Under the National Flood Insurance Program (NFIP), there is typically a 30-day waiting period before flood insurance coverage becomes effective, which is why lenders must ensure borrowers obtain coverage well in advance of closing.
Why This Is the Correct Answer
Under the National Flood Insurance Program (NFIP), there is typically a 30-day waiting period before flood insurance coverage becomes effective, which is why lenders must ensure borrowers obtain coverage well in advance of closing.
More Federal Laws Questions
A mortgage broker's website states 'Qualified borrowers can get loans with down payments as low as 3%.' Which statement about TILA advertising requirements is correct?
A loan's APR increases from 4.25% on the Loan Estimate to 4.35% on the Closing Disclosure due to a rate lock expiration. What action is required?
A lender originates a mortgage that meets all QM requirements. Three years later, the borrower defaults and claims the lender violated the ATR rule. What legal protection does the lender have?
For a closed-end mortgage loan, when must the creditor provide the Closing Disclosure to the borrower?
Which of the following documents must be provided to trigger the start of the 3-day rescission period?
People Also Study
General Mortgage Knowledge
23% of exam
Mortgage Loan Origination Activities
25% of exam
Ethics, Fraud & Consumer Protection
17% of exam
Uniform State Test Content
12% of exam
Previous Question
Under TILA, the right of rescission applies to which type of mortgage transaction on a consumer's principal dwelling?
Next Question
An applicant's loan is denied, and the lender sends an adverse action notice 35 days after the decision. The applicant claims this violates Regulation B. The lender's timing: