Mortgage loan origination activities
Mortgage loan origination activities tests the workflow from application through funding and the disclosures tied to each stage. Questions often ask what must happen next and when.
Stages and controls
- Application: under TRID, six pieces make an application: consumer name, income, Social Security number, property address, estimated property value, and loan amount. The LE clock starts once all six are present.
- Early disclosures: LE and the RESPA special information booklet within three business days; ARM disclosures for adjustable-rate loans.
- Processing: verify income, assets, employment, title, appraisal, and insurance; document changed circumstances that require a revised LE.
- Underwriting: automated or manual review; conditions; ability-to-repay verification; adverse-action notices when denied.
- Closing: CD at least three business days before consummation; rescission if applicable; funding and recording.
- Servicing: initial servicing disclosure and transfer notices.
Worked example
A caller gives name, income, SSN, property address, value, and loan amount on Monday but has not signed anything. That is still an application, so the LE must be delivered or mailed by Thursday. If the property address were missing, the six-piece test would not be met and the LE clock would not start.
Traps
Treating a prequalification as an application when all six pieces are present; charging an appraisal fee before the LE; missing the four-business-day revised-LE rule after a rate lock; assuming the CD may be handed over at closing without the waiting period.