Mortgage Loan Inquiry and Application Process
What counts as an application
For mortgage disclosure purposes, an application exists once you have six pieces of information: borrower name, monthly income, Social Security number, property address, estimated property value, and loan amount. A signed 1003 or a fee is not required to trigger disclosure obligations.
Timing rules
- Loan Estimate within three business days of application, using the general definition of business day (days the offices are open to the public for substantially all business).
- No fees, including credit report fees, before the borrower indicates an intent to proceed; oral intent is acceptable.
- A revised Loan Estimate is due within three business days of a changed circumstance and must be received no later than four business days before consummation, using the specific definition (all calendar days except Sundays and federal holidays).
- The Loan Estimate must be received at least seven business days before consummation.
- Adverse action notice within 30 days of a completed application.
Traps
Questions love to swap the two business-day definitions. The seven-day waiting period, the four-business-day re-disclosure deadline, and rescission all use the specific definition; Loan Estimate delivery uses the general one. Mailed disclosures are delivered when mailed, not when received. A prequalification letter is not an application.
Rule of thumb
Count six items, start the three-business-day clock, and never collect a fee before intent to proceed.
Worked example
A borrower submits all six items on Monday. The Loan Estimate must be delivered or mailed by Thursday. If the borrower then changes the loan amount, a revised Loan Estimate is due within three business days of learning of the change and must reach the borrower at least four business days before closing.