Mortgage Mortgage Loan Origination Activities Questions and Answers 2

Question 1

Under TRID rules, when must a Loan Estimate be provided to the borrower after receiving a mortgage application?

Accepted Answer

Within 3 business days

Answer

Within 5 business days

Answer

Within 7 business days

Answer

Within 10 business days

Question 2

Which of the following triggers the obligation to provide a Loan Estimate under the six-piece application rule?

Accepted Answer

Receiving the borrower's Social Security number as the sixth data point

Answer

Receiving the borrower's employment history

Answer

Completing the property appraisal

Answer

Pulling the borrower's credit report

Question 3

A mortgage loan originator is compensated based on the loan amount rather than the interest rate. Which regulation primarily governs this compensation structure?

Accepted Answer

Loan Originator Compensation Rule under Regulation Z

Answer

RESPA Section 8

Answer

Fair Housing Act

Answer

Equal Credit Opportunity Act

Question 4

During the origination process, the borrower's debt-to-income ratio is calculated. Which debts are typically included in the back-end DTI ratio?

Accepted Answer

All recurring monthly obligations including the proposed housing payment

Answer

Only the proposed mortgage payment and property taxes

Answer

Only revolving credit card balances

Answer

Only installment loans with more than 12 months remaining

Question 5

A borrower requests a rate lock during the origination process. What happens if the loan does not close before the lock expiration date?

Accepted Answer

The borrower may need to accept the current market rate or pay for a lock extension

Answer

The lender must honor the original locked rate indefinitely

Answer

The loan application is automatically denied

Answer

The borrower receives a lower rate as compensation

Question 6

Which document does the loan originator use to verify a self-employed borrower's income during origination?

Accepted Answer

Two years of personal and business tax returns

Answer

A single recent pay stub

Answer

An employer verification letter

Answer

A bank statement from the last 30 days