The new rules require that a Loan Estimate is sent to the consumer no later than the third business day after the consumer’s application is received, regardless of whether a broker or lender takes that application. What options do wholesalers have for producing the Loan Estimate in this tight window, when a third-party loan originator is taking the application?

Wholesalers can do really one of two (or if you count blank Loan Estimates, three) things. One would be you trust the broker to generate the Loan Estimate on your behalf. And you make sure that they’re doing it in a manner that’s compliant with the rules and they’re also producing estimates that you’re going to be willing to guarantee. That’s one way to do it. Another way to do it, which I have heard, is having a tight enough information flow so when your broker takes an application, as soon as that application is completed, you know about it. And you’re producing the Loan Estimate, you—meaning the wholesaler—you’re producing the Loan Estimate in your own name, with your own estimates rather than trusting a broker to do that. That’s another option. If there’s any type of lag in information time that may cost you a day—remember you’re only going to have three business days, so you have a tighter window to do it. You can’t receive a package and then start your clock three from when you receive the package. It’s going to be three days from when the broker took the application. But if you have a way that your systems are synced up or your information is being shared, and you know exactly when that happens, another option you have is to produce the Loan Estimate yourself.

Answered By: Andy Arculin