Mortgage Broker cheat sheet

TILA/Reg Z: Loan Estimate due within 3 business days after application; Closing Disclosure must be received at least 3 business days before consummation.

Right of rescission: 3 business days for covered refinances and closed-end home equity loans on a principal dwelling; purchase-money loans are exempt.

RESPA Section 8 prohibits kickbacks, fee splits, and unearned fees for referrals of settlement services.

ECOA/Reg B: adverse action notice due within 30 days after a completed application.

HMDA/Reg C: covered lenders report application, origination, denial, demographic, and pricing data.

ATR/QM: creditors must verify repayment ability using eight underwriting factors; General QM imposes product-feature and price-based limits.

SAFE Act: MLOs must be licensed or registered and use an NMLS unique identifier.

Flood Disaster Protection Act: flood insurance required for improved property in a special flood hazard area if the loan is from a regulated lender.

HOEPA: high-cost mortgage triggers include APR, points-and-fees, and prepayment-penalty thresholds; added disclosures and restrictions apply.

PITI = principal + interest + property taxes + homeowners insurance; it is the standard estimate of the monthly housing payment.

LTV = loan amount ÷ lesser of purchase price or appraised value.

DTI = total monthly debt payments ÷ gross monthly income.

Conforming loans meet Fannie Mae/Freddie Mac rules and FHFA loan limits; jumbo loans exceed those limits.

FHA: 3.5% minimum down payment with MIP; VA: 0% down for eligible veterans with a funding fee; USDA: rural eligibility and income limits.

ARM structure: initial fixed period, then index + margin; caps limit initial, periodic, and lifetime increases.

One discount point = 1% of loan amount and generally lowers the note rate; origination fees compensate the lender or broker.

PMI: borrower may request cancellation at 80% LTV based on original value; automatic termination generally at 78%.

Fixed-rate fully amortizing loans have level payments; balloon loans have a final payment larger than prior payments.

TRID application = six pieces: borrower name, income, SSN, property address, estimated value, loan amount.

Pre-qualification is an informal estimate; pre-approval is a conditional underwriting decision subject to verification.

AUS findings from DU or LPA determine documentation and eligibility; manual underwriting applies when AUS is unavailable.

Rate lock agreement states rate, lock period, expiration, and extension fees.

Closing Disclosure delivery: at least 3 business days before consummation; certain changed terms require a revised CD and new waiting period.

TRID tolerance: zero tolerance for lender/affiliate fees and transfer taxes; 10% cumulative tolerance for certain other fees.

Processing collects title, appraisal, flood certification, homeowners insurance, employment, asset, and HOA information.

Closing includes settlement, funding, recording, and disbursement; rescission loans cannot fund until the rescission period expires.

Changed circumstances can permit a revised Loan Estimate; the revision must be delivered within 3 business days of receiving the information.

ECOA protected classes: race, color, religion, national origin, sex, marital status, age, and receipt of public assistance.

Fair Housing Act adds familial status and disability to protected classes for housing-related transactions.

Fraud indicators: inflated income, undisclosed debt, false occupancy, straw buyers, altered documents, and inflated appraisals.

RESPA Section 8 prohibits kickbacks and unearned fees; disclosed affiliated business arrangements must meet the AfBA safe harbor.

UDAAP prohibits unfair, deceptive, or abusive acts or practices in consumer financial products.

BSA/AML: CIP verifies identity; SARs are filed for suspicious activity; CTRs are required for currency transactions over $10,000.

GLBA requires privacy notices and safeguards for nonpublic personal information.

Conflicts of interest must be disclosed; compensation from affiliates or settlement providers cannot be hidden.

Redlining, steering, and discouragement are prohibited; marketing and underwriting must be applied consistently.

SAFE Act pre-license education: 20 hours; annual CE: 8 hours (3 federal law, 2 ethics, 2 nontraditional mortgage, 1 general).

MLOs must provide their NMLS unique identifier, which is used to track licensing and employment history.

Licenses renew annually through NMLS; late renewal may require fees and CE; inactive status restricts origination activity.

Branch offices generally require separate licenses or authorizations in states where the main office license does not cover them.

Licensees must notify the regulator of changes in name, address, or employment within state-specified deadlines.

Many states require a surety bond; bond amounts vary by state and license type.

Records retention commonly requires three years for mortgage transaction and licensing records, subject to state rules.

Advertising must not be false or misleading and must include required licensed name and NMLS identifier where mandated.

State regulators may examine, fine, suspend, or revoke licenses for unlicensed activity, disclosure violations, or prohibited conduct.