Mortgage Loan Originator (MLO) Licensing 2025 – 400 Free Practice Questions to Pass the Exam

The correct answer is that a borrower must be given a minimum of one business day to review a written loan modification agreement prior to consummation. This requirement is established under regulations that aim to provide borrowers with sufficient time to thoroughly understand the terms of the proposed modification. By ensuring that borrowers have at least one business day for review, the regulation seeks to promote informed decision-making and enhance consumer protection in the mortgage lending process.

One business day allows borrowers to consider their options and seek advice if necessary before agreeing to the modified loan terms. This timeframe helps ensure that borrowers are not rushed into decisions that could impact their financial future significantly.

Other options suggest either too little or too much time for review, which does not align with the specific regulations designed to protect borrowers in loan modification situations. The one business day provided strikes a balance between allowing sufficient time for consideration and the need for timely processing of loan modifications.