A lender can charge a transaction fee if the borrower fails to provide proof of insurance at least how many days before the policy expires?

The correct answer is based on the regulations governing lenders and the requirement for borrowers to provide proof of insurance. Specifically, lenders may charge a transaction fee if the borrower does not provide the necessary proof of insurance at least 30 days before the expiration of the current insurance policy.

This 30-day period allows lenders sufficient time to ensure that appropriate coverage is in place and gives borrowers a clear timeframe in which to secure or renew their insurance. It helps to mitigate potential risks for both parties involved in the lending process, ensuring that the property remains protected against unforeseen events.

Understanding this timeframe is essential for compliance with state regulations, as it outlines the responsibilities of both lenders and borrowers regarding insurance coverage.