ID MLO key terms

A standardized three-page disclosure a lender must deliver to a mortgage applicant within three business days of receiving an application, showing estimated closing costs, loan terms, and projected payments.

A five-page form the borrower must receive at least three business days before consummation, listing the final loan terms and actual closing costs so they can be compared with the Loan Estimate.

The receipt of six pieces of information: borrower name, income, Social Security number, property address, estimated value, and loan amount requested. This triggers disclosure timing obligations.

The moment the borrower becomes legally obligated on the credit transaction, generally at signing of the promissory note. It starts the three-business-day rescission clock for refinances and home equity loans.

Rules limiting how much certain closing costs may increase from the Loan Estimate to the Closing Disclosure, classified as zero tolerance, ten percent cumulative tolerance, or no tolerance.

A valid reason, such as new information about the borrower or property or an unforeseen event, that permits a lender to revise a Loan Estimate and reset cost tolerances.

A borrower's right to cancel certain refinance and home equity transactions secured by a principal dwelling within three business days after consummation, with no penalty.

A federal requirement that lenders make a reasonable, good-faith determination that a consumer can repay a mortgage according to its terms before extending credit, verified with documented income and debts.

A mortgage meeting federal standards, such as limits on points and fees and required underwriting, that gives the lender legal protection against certain borrower claims.

A calculation under qualified mortgage rules that limits certain loan charges to a set percentage of the loan amount, based on the size of the loan.

A loan exceeding federal rate or fee thresholds that triggers extra protections, including additional disclosures, escrow requirements, and limits on prepayment penalties.

A charge imposed when a borrower pays off a loan early. Federal rules restrict these penalties for high-cost and qualified mortgages and prohibit them in many circumstances.

An account a servicer maintains to hold borrower funds for property taxes and insurance and to pay those bills when due, with annual statements and limits on cushion amounts.

A federal law governing settlement practices, escrow accounts, servicing transfers, and disclosure of affiliated business arrangements, and prohibiting kickbacks for referrals of settlement services.

The RESPA rule barring giving or receiving anything of value in exchange for referrals of settlement service business, and barring unearned fees from splitting charges.

A relationship in which a person referring settlement business has an ownership interest in the provider, requiring a written disclosure of the arrangement and an estimate of charges.

A federal law prohibiting lenders from discriminating against applicants on protected bases such as race, sex, age, marital status, national origin, or receipt of public assistance income.

A written statement a lender must send within thirty days when denying credit or taking other unfavorable action, listing the reasons or explaining how to obtain them.

The implementing regulation for the Equal Credit Opportunity Act, covering discrimination, collection of monitoring data, notification requirements, and rules on appraisals and spousal signatures.

A federal law governing the accuracy, privacy, and use of consumer credit information, including permissible purpose, adverse action notices based on credit reports, and dispute rights.

A legally recognized reason to obtain a consumer credit report, such as a credit application, account review, or court order, required before pulling a report.

The sale or reassignment of the right to collect payments and administer a mortgage, which requires advance notices to the borrower from both the old and new servicer.

A required disclosure telling borrowers how to submit a written complaint or request for information about their loan servicing, and the servicer's deadlines to acknowledge and respond.

A borrower's total monthly debt payments divided by gross monthly income, used in underwriting to judge capacity to repay and to meet ability-to-repay standards.

The process of documenting a borrower's earnings through pay stubs, tax returns, employer checks, or account statements so that repayment ability is based on reliable evidence.

Software that evaluates loan applications against investor and insurer guidelines, producing an approval, referral, or denial recommendation and documenting the credit decision.

A review of a loan file by a person applying guideline requirements without relying on an automated recommendation, often used when the automated system returns a referral.

Strengths in a loan file, such as large reserves or stable employment, that offset a weakness like a higher debt ratio and support approval under guideline exceptions.

The loan amount divided by the property's appraised value or purchase price, whichever is lower, indicating the lender's exposure and driving mortgage insurance requirements.

The total of all mortgage liens on a property divided by its value, used to assess risk when a borrower has a second mortgage or home equity line.

Insurance protecting the lender against loss when a borrower defaults with a low down payment, often cancellable once the loan balance falls to a set percentage of value.

A federal law requiring automatic termination and borrower-requested cancellation of private mortgage insurance at specified loan-to-value thresholds, with annual disclosures.

The rule that the borrower must receive the Closing Disclosure no later than three business days before consummation, with a new waiting period if certain terms change.

A borrower's affirmative statement, received after the Loan Estimate is delivered, authorizing the lender to collect fees before providing the required disclosures.

Idaho law requiring persons who negotiate or place mortgage loans for others to be licensed by the state regulator, with exemptions and bonding and education requirements.

The state agency that licenses and supervises mortgage brokers, lenders, and originators in Idaho, investigates complaints, and may impose fines or revoke licenses.

A state credential, tied to federal registration requirements, that a person must hold to take residential mortgage applications, with education, testing, and background check conditions.

A shared online system used by state regulators to manage license applications, renewals, and records for mortgage companies and originators, including Idaho licensees.

Idaho legislation setting conduct, disclosure, and prohibited-practice standards for residential mortgage lending and servicing in the state, enforced by the Department of Finance.

Conduct in mortgage dealings that misleads or harms consumers, such as false advertising or hidden fees, prohibited by state and federal law and subject to enforcement action.

Intentional deception, such as falsifying income or occupancy on a loan application, to obtain a benefit or cause loss, exposing the actor to criminal and civil liability.

Misrepresenting whether a borrower will live in the property, typically to obtain a lower rate or higher loan limit reserved for primary residences.

A person who takes title or applies for a loan on behalf of another who cannot or will not qualify, concealing the true borrower or purchaser from the lender.

A federal requirement that financial institutions maintain a written identity theft prevention program to detect and respond to patterns indicating possible identity theft.

Use of another person's personal information, such as a Social Security number, to obtain credit or property without that person's consent.

A situation in which an originator's personal or financial interest, such as a referral relationship, could improperly influence advice given to a borrower.

A legal obligation to act in another party's best interest with loyalty and care, which may arise for mortgage professionals in certain advisory or brokerage relationships.

A federal rule requiring lenders to give privacy notices and let consumers opt out of sharing nonpublic personal information with certain third parties.