United States
Hong KongThe six items that make an application
Name, income, social security number, property address, an estimate of value and the loan amount sought. Under 12 CFR 1026.2(a)(3) those six items constitute an application, and receiving them starts the three-business-day Loan Estimate clock.
Six items. Learn them as a list, because the exam asks for them as a list.
The six
- The consumer's name
- The consumer's income
- The consumer's social security number, to obtain a credit report
- The property address
- An estimate of the value of the property
- The mortgage loan amount sought
That is the definition at 12 CFR 1026.2(a)(3). Nothing else is required and nothing on the list is optional.
Why it matters so much
Because it starts the clock, and the clock is not a matter of anyone's intention.
An originator taking a casual enquiry over the phone who collects all six items has received an application. The Loan Estimate is then due within three business days whether or not a formal application form was ever completed.
A scenario will describe an informal conversation, list the information gathered, and ask what the originator must now do. Count the six items. If they are all there, the answer is a Loan Estimate within three business days.
What is not on the list
A completed application form. A signature. A credit report actually pulled. Documentation of income. A property inspection.
None of those are required for an application to exist. Candidates who assume the trigger is a signed form get these questions wrong consistently.
How the six changed
There used to be a seventh catch-all item - any other information the creditor deemed necessary - which let creditors delay the trigger by declaring the file incomplete.
The TRID rule removed it. The list is now closed at six, which is exactly the point: the creditor cannot define its way out of the deadline.
A memory hook
Who, how much they earn, their number, where, what it is worth, and how much they want. Six questions you would ask anyway, in the order you would ask them.
Common questions
What are the six items of a mortgage application?
Name, income, social security number, property address, an estimate of the property value and the loan amount sought.
Does an application need a signed form?
No. Once the six items are received an application exists, whatever paperwork has or has not been completed.
What happens when all six are received?
The Loan Estimate becomes due within three business days.
Was there once a seventh item?
Yes, a catch-all for any other information the creditor deemed necessary. TRID removed it so the trigger could not be delayed at the creditor's discretion.
Where is this defined?
At 12 CFR 1026.2(a)(3) in Regulation Z.