To comply with the FACT Act, what must a mortgage loan originator do with loan applications and documentation?

Complying with the Fair and Accurate Credit Transactions (FACT) Act requires that mortgage loan originators ensure the protection of sensitive information contained in loan applications and documentation. By placing all documents in a secure location, MLOs safeguard against unauthorized access and potential identity theft, which aligns with the Act's emphasis on secure handling of consumer information. This security measure reflects the proactive steps necessary to protect consumers' personal data.

The other aspects of the options do not directly reflect the compliance requirements under the FACT Act. For example, noting the race of applicants could implicate fair lending laws rather than FACT compliance, which focuses on credit information processing and consumer protection. Considering only legal forms of income, while ethical, doesn't specifically address the preventive focus of the FACT Act. Sending adverse action notices within 30 days pertains more specifically to regulations under the Equal Credit Opportunity Act (ECOA), not the FACT Act.

Therefore, placing loan application documents in a secure location is the necessary action that aligns with the FACT Act's requirements for protecting consumer information.