Which loans do not require a Loan Estimate?

Which loans do not require a Loan Estimate?

• A. HELOC, reverse mortgages, and mobile-home loans not attached to land
• B. Conventional fixed-rate loans
• C. FHA purchase loans
• D. VA construction loans

Answer: (A)

Under the TRID framework, a Loan Estimate is required for most closed-end mortgage loans secured by real property to help borrowers compare costs and terms. However, some loans are excluded from needing an LE. Specifically, open-end lines of credit like a home equity line of credit (HELOC) are exempt because they are not a single closed loan with a defined payoff term. Reverse mortgages are also exempt and use their own disclosure requirements. Additionally, loans secured by a mobile home that is not attached to land are not considered real-property loans, so they do not require a Loan Estimate. In contrast, loans such as conventional fixed-rate mortgages, FHA purchase loans, and VA construction loans are typically covered by TRID and do require a Loan Estimate since they are closed-end loans secured by real property.

Under the TRID framework, a Loan Estimate is required for most closed-end mortgage loans secured by real property to help borrowers compare costs and terms. However, some loans are excluded from needing an LE. Specifically, open-end lines of credit like a home equity line of credit (HELOC) are exempt because they are not a single closed loan with a defined payoff term. Reverse mortgages are also exempt and use their own disclosure requirements. Additionally, loans secured by a mobile home that is not attached to land are not considered real-property loans, so they do not require a Loan Estimate.

In contrast, loans such as conventional fixed-rate mortgages, FHA purchase loans, and VA construction loans are typically covered by TRID and do require a Loan Estimate since they are closed-end loans secured by real property.