Why is verifying borrower documentation important in mortgage processing?
Accurate documentation helps ensure the borrower’s information is valid and the loan complies with legal requirements.
What document is used to verify a borrower’s income?
W-2s and pay stubs provide income details used to assess borrower eligibility.
Which regulation requires lenders to disclose loan costs clearly?
The Truth in Lending Act (TILA) ensures borrowers receive transparent information about loan terms and fees.
What is the purpose of the Closing Disclosure form?
The Closing Disclosure outlines all final terms and costs of the mortgage before closing.
Which document confirms property value for the loan?
An appraisal provides an independent estimate of the property's value for loan underwriting.
Why is compliance with the Equal Credit Opportunity Act (ECOA) important?
ECOA prohibits discrimination in any aspect of a credit transaction.
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What is the function of the Loan Estimate form?
It provides a summary of key loan terms, including estimated interest rate, monthly payment, and closing costs.
What does a Verification of Employment (VOE) document provide?
VOE confirms a borrower's employment status, position, and income.
Which agency enforces mortgage lending regulations in the U.S.?
The Consumer Financial Protection Bureau (CFPB) oversees compliance with federal mortgage lending laws.