Origination ActivitiesQuestion 246 of 400
At funding, the settlement agent disburses loan proceeds. In a typical purchase, funds are primarily disbursed to:
a.The loan originator as commission only
b.The borrower directly in cash
c.The appraiser and inspector before all others
d.The seller and to pay off existing liens, taxes, and settlement charges per the settlement statement
Explanation
At funding and disbursement, the settlement agent pays the seller, pays off existing liens and prorated taxes, and covers settlement charges as itemized on the settlement statement/Closing Disclosure. Proceeds are not paid solely as commission or handed to the borrower in cash on a purchase.
Practice all 400 questions free — no signup required.
Related questions on this topic
- Under the appraisal rules of ECOA/Regulation B, when must a lender provide the applicant a copy of the appraisal on a first-lien dwelling loan?
- During underwriting, a DU finding lists 'Approve/Eligible' but includes verification messages. What do these messages require?
- A survey ordered during closing reveals that the neighbor's fence extends three feet onto the subject property. This is an example of:
- A borrower earns a $3,000 monthly bonus that has been consistent for three years and is likely to continue. How may an underwriter treat this bonus income?
- An appraiser uses the sales comparison approach on a single-family home. This approach primarily estimates value by:
- A loan is 'cleared to close.' What does this status indicate?
Last reviewed: · editorial process
PrepPass Editorial Team · Verified against NMLS SAFE Mortgage Loan Originator National Test · How we review