What should a licensee avoid doing when presenting a mortgage loan option to a borrower?

A licensee should avoid making unrealistic claims about loan approval times when presenting a mortgage loan option to a borrower because such claims can lead to misunderstandings and set false expectations. Transparency and honesty are critical in the mortgage lending process. Misrepresenting the approval timeline can undermine the trust between the borrower and the lender. Borrowers depend on accurate information to make informed decisions about their financial future, and an unrealistic timeline may cause undue stress or lead to financial decisions that are not in their best interest.

In contrast, explaining the terms and conditions, providing detailed repayment options, and discussing the importance of good credit are all essential practices that contribute to a borrower’s understanding of the process and help them feel more prepared and confident in their choices. Clear communication of realistic expectations, on the other hand, fosters a responsible lending environment.