Conducting a Loan Signing Flashcards

Before presenting documents to borrowers, what should an NSA do with the loan package?

Answer: Review the package to ensure it is complete and in order

The NSA should review the loan package before the signing to confirm all documents are present and properly organized.

When a borrower asks an NSA to explain what a specific loan term means, the NSA should:

Answer: Refer the borrower to the lender or loan officer for clarification

NSAs must not provide legal or financial advice; they should direct borrowers to the lender or loan officer for explanations.

Which document in a loan package informs the borrower of the total cost of the loan over its lifetime?

Answer: Truth-in-Lending Disclosure (TIL/TILA)

The Truth-in-Lending Disclosure (TILA) outlines the APR, finance charge, and total payments over the loan term.

What is the proper way to handle a document that requires a borrower's initials on every page?

Answer: Remind the borrower to initial each required page before proceeding

The NSA must ensure the borrower initials every page that requires initials to avoid rejection of the loan package.

At a loan signing, the borrower notices their name is misspelled on several documents. What should the NSA do?

Answer: Contact the hiring party for instructions before proceeding

Name discrepancies must be reported to the hiring party (title company or lender) for guidance before the signing continues.

Which of the following best describes the NSA's role during the actual signing appointment?

Answer: Facilitate the signing of documents and notarize as required

The NSA's role is to guide borrowers through the signing process and notarize applicable documents—not to advise.

What should an NSA do if a borrower refuses to sign a required document during the closing?

Answer: Stop the signing, document the refusal, and notify the hiring party

If a borrower refuses to sign, the NSA must stop the signing, note the refusal, and report it to the title company or lender.

After completing a loan signing, how should the NSA return the signed loan package?

Answer: Deliver it per the hiring party's specific instructions (e.g., overnight courier)

NSAs must return the completed package as directed by the hiring party, which usually requires a specific delivery method such as overnight courier.

What does the term 'wet signature' mean in the context of a loan signing?

Answer: An original handwritten signature on a physical document

A wet signature refers to an original, handwritten signature on a physical document, distinguishing it from an electronic signature.

During a loan signing, the borrower's spouse is present but is not listed as a borrower. Under what circumstance might the spouse still need to sign?

Answer: If the property is in a community property state and the spouse has an ownership interest

In community property states, a non-borrower spouse may need to sign the Deed of Trust to relinquish their interest in the property.

An NSA is asked to notarize a document where the acknowledgment wording is missing. What should the NSA do?

Answer: Attach a loose certificate with the proper acknowledgment wording

NSAs may attach a loose notarial certificate with the correct wording when the document lacks a pre-printed acknowledgment or jurat.

What is a 'funding number' or 'loan number' and why must the NSA ensure it appears correctly on documents?

Answer: It is the unique identifier for the loan that ensures all documents are tied to the correct file

The loan number uniquely identifies the transaction and must be consistent across all documents to ensure the package is processed correctly.

When an NSA completes the notarial certificate on a document, what information must they typically include?

Answer: Their commission expiration date, signature, stamp/seal, and the venue (state/county)

A notarial certificate must include the venue (state and county), the NSA's official signature, and their notary stamp or seal, plus the commission expiration date where required.

What is the purpose of the 'Compliance Agreement' found in many loan packages?

Answer: It obligates the borrower to cooperate in correcting minor errors or re-signing documents if needed

The Compliance Agreement is a borrower's promise to cooperate with the lender if minor clerical errors need to be corrected after closing.

An NSA arrives at a signing and discovers the loan package is missing the Closing Disclosure. What should they do?

Answer: Contact the hiring party immediately and await instructions

A missing required document must be reported to the hiring party immediately; the NSA should not proceed without all required documents.

Which scenario most accurately represents a 'table-funded' loan signing?

Answer: The lender provides funds to the title company at the closing table, allowing disbursement at signing

In a table-funded closing, the lender wires funds to the title company so that disbursement occurs simultaneously with signing.

What does it mean when a notary uses a 'jurat' instead of an 'acknowledgment'?

Answer: The signer swears or affirms that the document's contents are true, typically in person

A jurat requires the signer to swear or affirm under oath that the document's contents are true, whereas an acknowledgment only verifies the signature.

If a borrower is signing as an attorney-in-fact (under a Power of Attorney), how should the signature line typically read?

Answer: The principal's name, followed by the attorney-in-fact's name and 'Attorney-in-Fact'

When signing under a Power of Attorney, the signature typically reads '[Principal Name], by [Attorney-in-Fact Name], Attorney-in-Fact' to reflect the representative capacity.

How many copies of the Notice of Right to Cancel must typically be provided to each borrower on a refinance?

Answer: Two copies per borrower (plus one executed copy)

Under TILA/Regulation Z, each borrower with a right to rescind must receive two copies of the Notice of Right to Cancel, plus one completed copy.

An NSA discovers after leaving the signing that a borrower did not sign one page of the Deed of Trust. What is the appropriate next step?

Answer: Notify the hiring party immediately and follow their instructions for a cure

The NSA must notify the hiring party immediately; the lender or title company will determine whether a corrective signing or other cure is needed.