Finance
The Closing Disclosure must be provided to the borrower how many business days before closing?
A1 business day
B3 business days✓ Correct
C5 business days
D7 business days
Explanation
Under TRID rules, the Closing Disclosure must be provided to the borrower at least 3 business days before the consummation (closing) of the mortgage transaction.
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Key Terms to Know
Discount Points
Prepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Deed of TrustA security instrument used in many states instead of a mortgage, involving three parties: borrower (trustor), lender (beneficiary), and a neutral trustee.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
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