Loan Officer Practice Exam 2025 – Comprehensive All-in-One Guide for Exam Success!

Recording application and processing fees in the Closing Disclosure under "Origination Charges" is accurate because this section is specifically designated for all fees associated with the lender's origination of the loan. "Origination Charges" include various costs that a borrower pays for the processing of the loan application, including the application and processing fees themselves.

This categorization helps ensure transparency in the disclosure process, making it clear to borrowers how much they are paying for lender-related services. It allows borrowers to understand the costs involved directly tied to the loan origination process, distinguishing these fees from other types of charges that may be present in the Closing Disclosure.

The other categories mentioned, like "Services Borrower Did Not Shop For" and "Prepaids," serve different purposes in the context of the disclosure. "Closing Costs" is a broader term that encompasses several types of expenses, but "Origination Charges" is the most precise category for the specific fees being asked about.