Loan Officer Practice Exam

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How many days does a mortgage applicant have to respond to a Loan Estimate before the lender is no longer bound by its terms?

The correct answer is: 10

A mortgage applicant has 10 days to respond to a Loan Estimate before the lender is no longer bound by its terms. This 10-day period is established to give the borrower ample time to review the Loan Estimate thoroughly, compare it with other offers, and make an informed decision about whether to proceed with the loan. The requirement for this timeframe is part of the TILA-RESPA Integrated Disclosure (TRID) rules, which aim to ensure transparency and protect consumers in the mortgage process. After this 10-day period, if the borrower does not respond, the lender is not obligated to honor the terms laid out in that specific Loan Estimate, which may vary due to changes in the market or the borrower's situation. This extended period is important as it reflects the lender's commitment to providing clear and comprehensible information to help the borrower understand their options before making a commitment.