FL MLO key terms

A federal law that requires lenders to give borrowers information about settlement costs and that bars paying or receiving things of value for referring mortgage settlement business.

A federal consumer credit law that requires lenders to disclose the cost and terms of a mortgage loan, including the finance charge and annual percentage rate, before the borrower is obligated.

A set of CFPB rules that combine mortgage disclosures into the Loan Estimate and Closing Disclosure and set deadlines for delivering them to borrowers.

A federal law that prohibits creditors from denying credit or setting terms based on race, color, religion, national origin, sex, marital status, age, or receipt of public assistance.

The Federal Reserve rule that implements the Equal Credit Opportunity Act, covering application processing, record retention, appraisal notices, and adverse action notices.

The rule that implements the Truth in Lending Act and sets mortgage disclosure, advertising, loan originator compensation, and high-cost mortgage requirements.

A federal law that requires many mortgage lenders to collect and report data about applications, loans, and borrower characteristics so regulators can spot discriminatory lending patterns.

A federal law that bars discrimination in the sale, rental, and financing of housing because of race, color, religion, sex, disability, familial status, or national origin.

A federal law that requires mortgage loan originators to be licensed or registered, pass a test, complete education, and meet character and fitness standards.

The federal agency that writes and enforces consumer financial rules, including mortgage disclosure, fair lending, and unfair or deceptive practice requirements.

Unfair, deceptive, or abusive acts or practices in consumer financial transactions; these are prohibited and can lead to enforcement actions and penalties.

A Dodd-Frank requirement that a creditor make a reasonable, good-faith determination that a borrower can repay a mortgage loan based on verified income, debts, and other factors.

A mortgage that meets certain ability-to-repay and loan-feature standards, which generally gives the lender legal protection from borrower claims about repayment ability.

A federal law that requires flood insurance on loans secured by property in a special flood hazard area when the loan is made, increased, extended, or renewed by a regulated lender.

A prohibited payment or thing of value given to someone for referring settlement service business, unless a specific RESPA exception applies.

A three-page TRID form that gives a borrower estimated loan terms, projected payments, and closing costs, generally within three business days after a complete application.

A five-page TRID form that shows the final loan terms and closing costs; the borrower generally must receive it at least three business days before closing.

The annual percentage rate expresses the cost of credit as a yearly rate and includes the finance charge, such as interest and certain fees, so borrowers can compare loans.

A notice a creditor must send when it denies an application or takes other unfavorable action, explaining the reasons and preserving the borrower's rights under fair credit laws.

The four parts of a typical monthly mortgage payment: principal, interest, property taxes, and homeowners insurance. Lenders use this figure to judge housing affordability.

The process of paying off a mortgage through scheduled payments that cover interest first and gradually reduce principal over the loan term.

The loan-to-value ratio compares the loan amount to the property's appraised value or sales price; a higher ratio means less equity and more lender risk.

The debt-to-income ratio divides a borrower's total monthly debt payments by gross monthly income; lenders use it to judge whether the borrower can handle a new mortgage.

Private mortgage insurance protects the lender if a borrower defaults; it is often required when the down payment is less than 20 percent and may be canceled later.

An account a lender uses to hold part of the monthly payment for property taxes and insurance and to pay those bills when they come due.

An adjustable-rate mortgage has an interest rate that can change over time based on a market index plus the lender's margin, so payments may rise or fall.

The process of reviewing a borrower's credit, income, assets, debts, and the property to decide whether a mortgage should be approved.

An independent, licensed opinion of a property's market value that lenders use to confirm the home is worth enough to support the loan.

A lender's conditional commitment to lend a set amount based on verified income, assets, and credit, usually subject to a satisfactory property appraisal and final underwriting.

The Uniform Residential Loan Application, also called Form 1003, is the standard form borrowers complete to provide personal, employment, asset, and loan information.

A borrower's written statement that they want to continue with a mortgage application after receiving the Loan Estimate, which allows the lender to collect certain fees.

A legal obligation to act in another person's best interest, putting the client's interests ahead of the professional's own and disclosing conflicts.

Intentionally lying or leaving out important facts to obtain a mortgage, a better rate, or a larger loan, such as falsifying income or occupancy.

A situation in which a professional's personal, financial, or family interest could improperly affect their judgment or advice to a borrower.

The Florida agency that licenses and supervises mortgage brokers, lenders, and loan originators and enforces the state's mortgage laws and investigates consumer complaints.

The Florida law that governs mortgage brokerage and lending, including licensing, required conduct, disclosures, and penalties for violations. It applies to mortgage brokers, lenders, and loan originators doing business with Florida consumers.

A state credential required for an individual who takes mortgage applications or negotiates loan terms with Florida consumers, issued after testing and background checks.

A person or company licensed in Florida to arrange mortgage loans for borrowers by dealing with lenders, without funding the loans itself.

A company licensed in Florida that funds mortgage loans using its own money or a warehouse line and may also service the loans it makes.