CMB Mortgage Lending & Loan Origination 2 — Questions and Answers
Question 1: Under TRID, within how many business days after receiving a consumer's application must the creditor deliver or mail the Loan Estimate?
- 1 business day
- 3 business days (Correct answer)
- 7 business days
- 10 business days
Correct answer: 3 business days
Regulation Z requires the Loan Estimate to be delivered or placed in the mail no later than the third business day after receiving the application.
Question 2: Which item is NOT one of the six pieces of information that make up an 'application' under TRID?
- Consumer's Social Security number
- Estimated value of the property
- Mortgage loan amount sought
- Verified two-year employment history (Correct answer)
Correct answer: Verified two-year employment history
The six TRID items are name, income, SSN, property address, estimated property value, and loan amount sought; verified employment history is not one of them.
Question 3: How many business days before consummation must the consumer receive the Closing Disclosure?
- At least 1 business day
- At least 3 business days (Correct answer)
- At least 7 business days
- At least 10 business days
Correct answer: At least 3 business days
TRID requires the consumer to receive the Closing Disclosure no later than three business days before consummation.
Question 4: After the Closing Disclosure is issued, which change requires a corrected CD and a new three-business-day waiting period?
- A change in the seller's credit to the buyer
- The APR becomes inaccurate by more than 1/8 of 1% on a regular transaction (Correct answer)
- The closing appointment moves to a different time
- A small decrease in the recording fee
Correct answer: The APR becomes inaccurate by more than 1/8 of 1% on a regular transaction
A new waiting period is triggered only by an APR that becomes inaccurate, a change in loan product, or the addition of a prepayment penalty.
Question 5: Which charge falls in the zero-tolerance category under TRID?
- Origination charges paid to the creditor (Correct answer)
- Prepaid interest
- Homeowner's insurance premiums
- Fees for a service the borrower shopped for using a provider not on the lender's list
Correct answer: Origination charges paid to the creditor
Fees paid to the creditor, mortgage broker, or their affiliates cannot increase at all from the Loan Estimate absent a valid changed circumstance.
Question 6: Which fees are subject to the 10% cumulative tolerance under TRID?
- Lender origination fees and discount points
- Recording fees and third-party services selected from the lender's written provider list (Correct answer)
- Property taxes held in escrow
- Services from a provider the borrower found on their own
Correct answer: Recording fees and third-party services selected from the lender's written provider list
Recording fees and shoppable third-party services where the borrower uses a provider from the lender's list may not increase more than 10% in aggregate.
Question 7: If a consumer does not express intent to proceed within how many business days after the Loan Estimate is delivered, may the creditor issue a revised LE for any reason?
- 3 business days
- 7 business days
- 10 business days (Correct answer)
- 30 business days
Correct answer: 10 business days
Once 10 business days pass without intent to proceed, the creditor is no longer bound by the original Loan Estimate.
