Nationwide Mortgage Licensing System (NMLS) Practice Exam

Who is responsible for completing the HUD/Loan Disclosure?

1. The borrower

2. The closing agent

3. The loan originator

4. The grantor

The correct answer is: The closing agent

The responsibility for completing the HUD/Loan Disclosure primarily falls on the closing agent. This individual plays a crucial role in the closing process, which includes preparing and providing the necessary documentation that outlines the terms of the loan, including the HUD-1 Settlement Statement or the Closing Disclosure, depending on the transaction type. The HUD/Loan Disclosure is essential as it details the costs associated with the transaction, helping ensure that both the borrower and the lender have a clear understanding of the financial details involved. The closing agent coordinates this process, manages the signing of documents, and ensures that all parties receive the appropriate disclosures. While other parties, like the loan originator, might have input or initial responsibility for disclosing information to potential borrowers, the closing agent is the one tasked with finalizing and delivering the official HUD/Loan Disclosure at closing. This role is vital for compliance with regulations, as these documents must adhere to federal and state guidelines aimed at protecting consumers during the mortgage process.