Nationwide Mortgage Licensing System (NMLS) Practice Exam

Which document does the borrower NOT sign?

1. Deed

2. HUD-1/Loan Disclosure

3. Mortgage

4. Note

The correct answer is: Deed

The borrower does not sign the deed because the deed is a legal document that details the ownership of the property and is typically signed by the seller when transferring the property to the buyer. While the borrower, now the buyer, may be a party that benefits from the deed, they do not sign it during the transaction. Signing the deed is the responsibility of the seller, as it signifies the transfer of property rights. In contrast, the other documents mentioned, such as the HUD-1/Loan Disclosure, the mortgage, and the note, all require the borrower's signature. The HUD-1/Loan Disclosure itemizes the closing costs and is important for disclosure purposes. The mortgage document secures the loan against the property, and the note outlines the borrower's promise to repay the loan. All these documents ensure the borrower's commitment and understanding of the terms and conditions of the loan agreement.