Mortgage Process Question and Answers Flashcards
6 cards from real Mortgage practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Mortgage Process Question and Answers flashcards as text
What is the purpose of a loan estimate (LE) provided by lenders?
Answer: To provide estimated costs, interest rate, and monthly payment within three business days of application
Under TRID rules, lenders must issue a Loan Estimate within three business days of receiving a mortgage application, outlining estimated terms and costs.
During which stage of the mortgage process does the underwriter verify income, assets, and creditworthiness?
Answer: Underwriting
Underwriting is the stage where the lender thoroughly reviews the borrower's financial profile to determine loan approval.
What does a title search reveal during the mortgage process?
Answer: Any liens, easements, or ownership disputes on the property
A title search examines public records to ensure the property has a clear title free of legal claims or encumbrances.
What is the 'clear to close' designation in a mortgage transaction?
Answer: All underwriting conditions have been satisfied and the loan is approved for closing
Clear to close means the underwriter has reviewed and approved all documentation, and the loan is ready to proceed to the closing table.
How long is the mandatory waiting period after receiving the Closing Disclosure before a borrower can sign closing documents?
Answer: 3 business days
Federal regulations require borrowers to receive the Closing Disclosure at least three business days before closing to review final terms.
What typically happens at the 'funding' stage after closing documents are signed?
Answer: The lender disburses the loan amount to the seller or settlement agent
Funding occurs when the lender wires or transfers the loan proceeds so the transaction can be completed and ownership transferred.