MLO Timeline Flashcards
What are the 4 C’s?
Capacity, Collateral, Credit, Capital
What is a CRA?
Credit Reporting Agency
What is the “Capacity?”
A client’s affordability. (How much they can afford).
What is a PITI payment?
Principal Interest Taxes Insurance
What is Front-End Ratio?
Housing expense ratio
What is back-end ratio?
All expenses related to the home + all contractual monthly debt / GMI (Gross Monthly Income)
What does GMI mean?
Gross Monthly Income
What is the Prequalification step in the mortgage process?
Identifying a loan problem that meets the clients goals
Underwriting means?
Ensures that the client and property match eligibility requirements.
What is a home inspector?
Determines if the home is in good condition, and warns of “money pits.” (Works for the Lender).
What is a home appraiser?
Determines the market value of the home.
3-1-1 approach (3 similar homes, 1 mile radius, 1 sold in the last year). INDEPENDENT CONTRACTOR
What is URLA?
ALIENS - Uniform Residential Loan App - 1003. The URLA, gives the Lender enough information from the borrower to proceed in the process.
3 Pages, and everything is estimated
Loan Estimate
What is Lender Points?
The borrower could buy down their “Par” rate, but purchasing Lender Points.
What is a Lender Rebate or Credit?
Monies paid by the Lender to help cover your closing costs. Results in a higher interest rate.
