New Jersey Residential Mortgage Lending Act Practice Test

The requirement for a lender to charge fees is that the Loan Estimate must have been provided first. This ensures that borrowers are informed about the costs associated with their mortgage loan upfront, promoting transparency and enabling them to understand the financial implications of the loan they are considering.

Before any fees can be charged, the lender is mandated by the Truth in Lending Act and the Real Estate Settlement Procedures Act to deliver the Loan Estimate to the borrower. This document includes details about the estimated interest rate, monthly payment, and total closing costs for the loan. By requiring the Loan Estimate to be provided before charging any fees, the regulatory framework aims to protect consumers from unexpected costs and assist them in making informed decisions about their mortgage options.

Other aspects related to fees, such as licensing, default status, or loan amounts, do not directly impact the requirement for disclosing charges to borrowers prior to initiating those fees.