Acts Flashcards
1
Q
Which is NOT regulated by TILA?
- Appraisal requirements for higher-priced mort loans (HPMLS)
- Loan Originator Compensation
- Interest Rate Limits
- Disclosure of Credit Terms to Consumers
A
Interest Rate Limits
These are the subject matter of state usury laws
2
Q
How many days does a loan originator have to deliver the Loan Estimate Disclosure after accepting the loan app?
- 3 calendar days
- 3 business days
- 2 business days
- 4 calendar days
A
Must be delivered or mailed within 3 business days
These are days of the week a business is open to the public (not necessarily mon-fri)
3
Q
The Truth in Lending Act is implemented by:
- Congress
- The Federal Home Loan Bank System
- Regulation Z
- HUD
A
The Federal Reserve Board’s Regulation Z implements the Truth in Lending Act
4
Q
Which of the following disclosures are to be used after Oct 3, 2015?
- Loan Estimate
- Good Faith Estimate
- Truth in Lending Disclosure
- HUD-1 Settlement Statement
A
The CFPB Loan Estimate and Closing Disclosure
5
Q
TILA requires lenders to:
- restrict kick-backs and other compensation for loan services
- use a simplified form to disclose loan terms to borrowers
- disclose APR, finance charges, and credit terms to consumers
- Compare their rates with other lenders’ loan terms/conditions
A
TILA was enacted in 1962
C.
Requires a lender to provide the consumer with informed use of credit info by requiring the disclosure of credit terms. It also requires the cost of credit calculations by setting forth the annual percentage rate and finance charge. It also required the disclosure of a projected payment schedule that would allow a consumer to compare pricing among competing lenders.
6
Q
Which one of the following is NOT one of the reasons why the CFPB replaced the old disclosures with the new TILA-RESPA Integrated forms?
- Allows for hidden fees to be disclosed after a loan closing
- Improve consumer understanding of mortgage loan terms
- Aid the consumer to do comparison shopping between lenders
- The forms are easier to use for both consumers and loan originators
A
A.
The goals of the new rule are to provide easier-to-use mortgage disclosure forms, improve consumer understanding, aid comparison shopping, and prevent surprises at the closing table
7
Q
The Closing disclosure must be given to the borrowers at least 3 business days before loan _______.
- Shopping
- Underwriting
- Consummation
- Application
A
Loan Consummation
8
Q
If a loan app is taken in-person by a loan originator, the RESPA Servicing Disclosure Statement must be:
- hand delivered to the applicant at that time
- read aloud to the applicant, and then confirmed again at the time of servicing
- mailed to the applicant within 3 business days
- Filled out and then given to the applicant at the time of settlement
A
A.
9
Q
Which of the following parties does NOT receive a copy of the Closing Disclosure?
- Borrower
- Lender
- Seller
- Appraiser
A
D.
10
Q
A borrower can use the Closing Disclosure to compare it to the Loan Estimate (LE) in order to:
- look for settlement cost tolerance violations.
- verify that the borrower is purchasing the correct property
- search for the undocumented Affiliated business arrangements
- ensuere that the settlement charges on the LE are exactly the same as the CD
A
A.
11
Q
Under RESPA, how long can a borrower continue to make loan payments without penalty to the old servicer if the borrower’s loan has been transferred to a new servicer?
-15 days
-4 weeks
60 days
-45 days
A
As long as timely payments are made to the old servicer
within 60 days of the transfer
12
Q
The RESPA Initial Escrow Account Statement will show the borrower an estimation of taxes, insurance premiums and other charges taht are expected to be paid from the escrow account during:
-the first 12 months of the loan
-years 5, 10, 15, 20, and 25
-the initial 45 days of servicing
the entire term of the loan
A
A.
13
Q
Regarding the RESPA-required disclosures, if a lender denies a borrower’s loan app within 3 business days of receiving it, the lender:
- is not required to provide the disclosure documents
- can report the app denial to HUD for govt monitoring purposes
- only has to deliver the Special Information Booklet
- must mail the disclosures
A
A.
14
Q
Which of the following disclosures must be given to the borrower at the time of loan settlement?
- Copy of borrowers loan app
- Servicing Transfer Statement
- The Initial Escrow Settlement Statement
- The Loan Estimate
A
C.
15
Q
According to RESPA, which one of the following is a settlement service?
- Offering a prize to those who refer business
- Sharing the appraisal fee with the lender who ordered the appraisal
- taking a loan app
- Providing Auto Insurance
A
C.
Settlement services include taking the loan app, loan processing/underwriting, and funding
A and B are prohibited RESPA
16
Q
All the following are characteristics of a Qualified Mortgage (QM) except:
- Current debt obligations for alimony and child support are considered
- total points cannot exceed 3%
- loan term must be at least 45 years
- regular periodic payments must be substantially equal in amount
A
A QM has regular periodic payments, a loan term not over 30 years, considers current debt obligations and total points and fees do not exceed 3%
C.
17
Q
In determining whether a borrower has the ability to repay, the lender must use all the following UW criteria EXCEPT:
- credit history
- the monthly payment of the subject loan
- marital status
- current employment status
A
C.
A lender can consider income factors such as employment, debt obligations, and credit history
18
Q
Creditors are to retain records that evidence compliance with the Ability-to-Repay rules for:
3 years
7 years
1 year
5 years
A
A.
The ATR/QM rules require a loan originator to retain evidence of compliance with the rules, including the prepayment penalty limitations, for 3 years after loan consummation
19
Q
The UW factor of “mortgage related obligations” for calculating a borrower’s ATR includes all of the following EXCEPT:
HOA dues
Property Taxes
Average Monthly Utilities
Ground Rent
A
C.
Mortgage related obligations also include:
insurance premiums
lease payments
20
Q
A General QM requires that the DTI ratio not exceed
36%
40%
43%
48%
A
C.
43%
21
Q
The final rules relating to ATR encourage:
- creditors to refinance non-standard mortgages and convert them to standard
- creditors to refinance standard mortgages and convert them to non-standard
- the use of non-standard mortgages
- the use of both standard and non-standard
A
A.
22
Q
Which of the following loan features qualifies a loan as a Qualified Mortgage?
IO payments
Negative Am
No Docs Required
Equal Monthly Payments
A
D.
23
Q
Which of the following is one of the eight required UW factors under ATR rules?
LTV ratio
Status of the property
Credit History
Marital Status
A
C.
The 8 UW Factors are:
1 Current or reasonably expected income or assets
2 Current employment status
3 monthly payment on any simultaneous loan
4 monthly payment on the covered transaction
5 the monthly payment for mortgage related obligations
6 Current debt obligations, alimony and child support
7 monthly DTI ratio or residual income
8 Credit history
24
Q
When determining the ability to repay with respect to ARMS, Monthly payments for underwriting purposes must be calculated by using:
- the introductory rate only
- the fully indexed rate or an introductory rate, the lesser
- the average rate over the life of the loan
- the fully indexed rate or introductory rate, the higher
A
For underwriting purposes the monthly payment for Adjustable Rate Mortgages must be calculated using the fully indexed rate or an introductory rate whichever is higher
D.
25
Mr. B is purchasing a $35,700 house. He will be putting 20% down on a conventional mortgage. to pass the points and fees test, what is the maximum allowed to be charged?
$1,428
$1,785
$3,000
$7,140
A.
20% of 37,500 is 7,140.
Subtract that from the price = 28,560 (Loan Amount)
the allowed points and fees range for a loan between 21,980 and 65,939 is 5% of the loan amount
5% of 28,560 = 1,428
26
For determining points and fees caps, which of the following can be excluded when calculating finance charges?
debt cancellation premiums
servicing charges
appraisal fees
private mortgage insurance premiums
D.
PMI premiums may be excluded.
Up-front PMI premiums may also be excluded if the premium is refundable on a prorated basis and a refund is automatically issued upon loan satisfaction. However, even if the premium can be excluded the creditor must include any portion that exceeds the up-front MIP.
Debt Cancellation premiums, appraisal fees, and servicing fees are all examples of charges that must be included in the total points and fees calculation
27
When calculating points and fees, the lender should:
- omit any known fees that are to be paid after the loan has been processed
- include all amounts that are known at or before loan consummation
- ensure that the total points and fees do not exceed 1,500
- calculate and include the amount of total interest paid for the life of the loan.
B.
When calculating points and fees, the lender should include all amounts that are known at or before loan consummation, even if the consumer pays them after loan consummation by rolling them into the loan amount.
28
Which one of the following is NOT a charge that can be included in real estate related points and fees?
commission paid to the real estate agent
notary fees
fees for preparing deeds
title examination costs
A.
The amount of commission paid to the real estate agent is not to be included in the limitations of points and fees
29
For a loan between $65,939 and $109, 898 what is the max cost for points and fees allowed?
8%
1,099
3%
$3,297
D.
30
A loan will be defined as a high-cost mortgage under the prepayment coverage test if the lender charges a penalty more than ________ after opening the account or charges a penalty that is more than 2% of the amount prepaid
36 months
60 months
12 months
24 months
A.
| 36 months after consummation
31
Loans are subject to HOEPA rules if they are consumer loans secured by the:
- initial construction of a new dwelling
- consumer's vacation home
- consumer's principal dwelling
- dwelling being used as collateral for the reverse mortgage
C.
| Principal Dwelling
32
Which one of the following features is prohibited on a high cost mortgage?
- requiring preloan counseling
- receiving compensation for originating the high-cost mortgage
- negative amortization
- scheduling a balloon payment on a bridge loan
C.
Negative am is prohibited on all HOEPA classified mortgages
33
A creditor must give the consumer of a high-cost mortgage a disclosure at least ______ before consummation of the loan or the opening of the account.
2 business days
24 hours
1 week
3 business days
D.
3 business days
2013 HOEPA rule
34
For loans $20,000 or more, the transaction will be designated as a high-cost mortgage loan if the total points and fees are:
$20,000 or less
3% or less
more than $5,000
greater than 5%
D.
A transaction is a high-cost mortgage if the points and fees exceed 5% of the total loan amount for a loan amount greater than or equal to $20,000
35
If a consumer is to receive a high cost mortgage, the consumer:
- should attend preloan counseling with the lender's in-house consumer education department
- must attend a preloan counseling session
- can attend a preloan counseling session at their option
- will have to pay for preloan counseling out of pocket before the lender will finalize the loan paperwork.
B. Must participate
36
There are three tests that can be used to determine if a loan is a high-cost mortgage. which of the following is NOT one?
- the points and fees coverage test
- the annual percentage rate (APR) coverage test
- the ATR coverage test
- the prepayment penalty coverage test
C.
37
When applying the points and fees coverage test, how many bona fide discount points may be excluded from the calculation when the transaction's interest rate before applying the discount points does not exceed APOR by more than 2 points?
- 2
- 1
- 0
B.
Up to 1 bona fide discount point may be excluded from the points and fees calculation if the interest rate before the discount does not exceed the Average Prime Over Rate (APOR) for a comparable transaction by more than 2 percentage points
38
A transaction is a high-cost mortgage loan if the transaction's APR measured as of the date the interest rate for the transaction is set exceeds the APOR for a comparable transaction on that date by more than ______ for first-lien transactions.
2%
3.5%
6.5%
$10,000
C.
the APR cannot exceed 6.5% of the APOR for a comparable transaction as of the date the interest rate is set.
39
As of Jan 10, 2014, fees charged to consumers for late payments are restricted to _______ of the past-due payment amount.
2%
4%
8%
10%
B.
4%
Late fees are restricted to 4% of the past due payment and pyramiding of late fees is prohibited
40
Which one of the following transactions does NOT meet the updated definition of an alternative mortgage transaction?
- Transactions where the the interest rate or finance charge may be increased or decreased after a specified period of time or under specified circumstances
- Transactions with a fixed interest rate where one or more of the regular periodic payments may result in an increase in the principal balance
- Transactions where the interest rate changes in accordance with fluctuations of an index
- Transactions where the creditor and the consumer agree to share some or all of the appreciation in the value of the property
B.
Section 1004.2 of the Dodd Frank Act defines an ARM
41
As of July 2011, Dodd Frank amended the AMTPA so that the act no longer operates to:
- Define the difference between a 'lender' and a 'creditor'
- prevent the origination of higher-cost mortgage loans.
- set the max interest rate for conventional mortgages
- preempt certain general state restrictions on mortgage transactions
D.
42
Regulation oversight of AMTPA is the responsibility of the:
Consumer Financial Protection Bereau
Office of Thrift Supervision
Office of the Comptroller of the Currency
National Credit Union Administration
CFBA
43
Prior to the enactment of the Alternative Mortgage Transaction Parity Act (AMTPA) in 1982, most states prohibited state housing creditors from making any loan that was:
Beyond sypervision of the CFPB
not a conventional fixed-rate & amortizing mortgage
beyond the supervision of the OCC
over the states' specific usury caps.
B.
44
Redlining (definition)
The practice of refusing to make loans or issue insurance policies in specific geographical areas for reasons other than the qualifications of the applicant. Racial, Ethnic, religious, national origin neighborhoods.
45
Which is FALSE about federal and state fair housing laws?
- unless an exemption applies, no one selling or renting housing can discriminate against anyone in the 7 protected classes in the sale and rental of housing
- HUD administers the federal fair housing laws
- individual states can pass and enforce fair housing laws that are less restrictive than the federal laws
- states may enact and enforce fair housing laws that are stricter than federal laws
C.
States, counties and cities may have standards more stringent than those provided for under the Fair Housing Amendments Act of 1988
46
Federal fair housing laws are administered by______.
FHA
HUD
RESPA
ECOA
HUD
47
Which act prohibits discrimination in housing based on race, color, religion, or national origin?
- Fair Housing Act of 1968
- Fair Housing Amendments of 1988
- Section 504 of the Rehabilitation Act of 1973
- Civil Rights Act of 1866
A.
48
Tom bought a 4-plex and is going to live in one of the units with his family. Tom will screen potential tenants for the other 3 units carefully to try to find the most desirable and safest neighbors for his family. Tom is:
- exempt under the federal fair housing law, but must check state law to see what his legal position is
- exempt from state fair housing laws because he has an exemption under federal law
- subject to both state and federal law
- not obliged to follow either state or federal law because he is screening to protect his family
A.
Four units or less are exempt from federal law if owner occupied. still subject to states
49
Which act prohibited discrimination in mortgage lending?
Equal Credit Opportunity Act of 1974
Housing and Community Development Act of 1974
Fair Housing Act of 1968
Fair Housing Amendments of 1988
ECOA 1974
only for mortgage lending
```
applies to:
Race
color
religion
origin
sex
age
marital status
public assistance income
```
50
Which to the following fair housing actions is NOT always illegal?
Racial Tipping
Steering
Redlining
Blockbusting
Racial tipping is the permitted practice of supplying truthful and factual information about racial composition of a neighborhood in a response to a buyer's stated desire to live in a particularly composed neighborhood.
Supplying this information without being prompted is illegal.
51
Which of the following is a protected class under federal fair housing laws?
Sexual orientation
military status
familial status
political affiliation
familial status
52
Which law was the first to prohibit discrimination on race?
Housing and Community Development Act 1974
Fair Housing Act 1968
Section 504 of the Rehabilitation Act 10973
Civil Rights Act 1866
1866
53
Which of the following may be considered when evaluating an application?
Income from Alimony
immigration status
income from public assistance (if needed)
all of the above
D.
Under ECOA all are permitted
54
Enforcement authority for ECOA belongs to the:
Consumer Financial Protection Bureau (CFPB)
Federal Trade Commission (FTC)
Federal Housing Finance Agency (FHFA)
Department of Housing an Urban Development (HUD)
CFPB has rulemaking authority over ECOA
55
ECOA applies to any creditor who regularly
- Has assets of over 5 million dollars
- participates in community service projects.
- extends, renews, or continues credit
- legally discriminates against foreign applicants
C.
56
After giving an adverse action notice to an applicant, a lender is required to retain the applicants loan files for______.
14 days
25 months
20 weeks
5 years
ECOA dictates 25 months
57
Under ECOA, a lender who has denied credit must notify the applicant of the denial within 30 days.
This notification must be:
in writing or over the phone
in person
in writing
in writing, over the phone or by email
in writing within 30 days
58
Which is NOT reported as part of the Home Mortgage Disclosure Act reporting requirements?
- the first and last name of the loan applicant
- applicant's gross income
- type of loan and amount
- reason why the app was denied
A.
Personal information is not reported for HDMA purposes.
ethnicity, race, and gender are
59
What are the categories of loans that must be reported under HDMA?
- Home improvements, Government Contracts, and Subprime Loans
- Home purchases, improvements, and refinances
- Hope purchases, refinances, and construction loans
- construction loans, subprime loans, and government contracts
3 categories
| Home purchases, home improvements, refinances
60
Why does HMDA require lenders to report race, ethnicity, sex, income, and disposition of applicants?
- to find how much money certain groups earn
- to find the time frame for lenders loan approval
- determine fines for fail lending for non compliant lenders
- to determine fair lending practices with lenders
D.
61
The form used by required institutions for reporting HMDA data is called the:
Section X
Reg C
Loan / Application Register
HMDA Data reporting form
D. Also known as HMDA-LAR or LAR or the register
62
Enforcement of the Fair Credit Reporting Act FCRA is the responsibility of:
Dodd-Frank Act
Federal Trade Commission FTC
Federal Reserve Board FRB
Consumer Reporting Agencies CRAs
B. FTC
63
The practice of stting and/or adjusting offered or extended credit terms to a consumer that is based upon that consumer's specific nonpayment risk is called:
an adverse action
underwriting
consumer credit score calculation
risk-based pricing
D. Risk based pricing
64
Which of the following is NOT one of the four parts to a company's identity theft prevention program as required by the red flag rule?
identify business relevant red flags
retire the program when no longer necessary
detect red flags
prevent and mitigate identity theft
B.
| retire program
65
Which one of the following is permitted under the credit card act amendment to FCRA?
- payments in excess of the minimum payment must be applied first towards the balance of the account with the highest interest rate and then each successive balance having the next highest interest rate
- a credit card issuer can increase a consumer's credit limit without considering ATR
- double-cycle billing, allowing a cc issuer to calculate the amount of interest a cardholder owes based on the average daily balance for the average daily balance for the past two months
- Payment due dates that change periodically are now permitted, known as floating due dates
A.
66
The purpose of FCRA is to:
- protect the public from the reporting of inaccurate information by credit agencies
- help consumers receive lower interest rates
- require disclosure of home insurance costs
- provide consumers with many finance options to choose from
A.
67
A consumer reporting agency must remove negative information from its database regarding a consumer's bankruptcy after:
7 years
12 years
10 years
5 years
10 years
7 years for late payments and delinquencies
68
The FACT Act requires that credit card issuer must give at least __________ advance notice relating to change in credit card terms, including rate increases:
60 days
30 days
14 days
45 days
D.
| 45 days
69
An adverse action notice should contain:
- a supplementary application for the consumer to complete and submit
- the credit score and other information the creditor used in making its decision
- the minimum credit score required, and the methods the creditor used to determine the consumer's score
- a copy of the FCRA
B.
70
Which is NOT an amendment to the FCRA?
The Credit Card Accountability and Disclosure Act
The Red Flag Program Clarification Act
The Fair and Accurate Credit Transactions Act
The Equal Opportunity Credit Act
D.
Title X of the Dodd-Frank Wall Street Reform and Consumer Protection Act is also a FCRA amendment
71
under the Gramm-Leach-Bliley Act, a customer is defined as:
- used to hold an account at the financial institution, but is no longer a client
- shares their NPI with as many financial institutions as they can
- has an ongoing relationship with a financial institution
- obtains financial products from a financial institution for commercial use
C.
72
The purpose of the Gramm-Leach-Bliley Act GLBA as it pertains to mortgage lending is to:
- make lenders follow state-specific guidelines in advertising interest rates.
- give consumers notice of the lender contact information
- make consumers accept marketing from mortgage originators
- require the lender to disclose its privacy policies and information sharing practices
D. Created to protect consumers' personal financial information
73
under GLBA, after establishing an ongoing relationship a financial institution must deliver a privacy policy to its customer:
every 4 weeks
only upon request
once per year
whenever the acct is viewed for privacy violations
once per year
| as long as customer relationship persists
74
GLBA is also known as:
Homeowners Privacy Protection Act
Financial Services Modernization Act of 1999
NPI Regulation Rule
Glass-Steagal Act
B.
75
Sets forth requirements for credit reporting and creditworthiness of borrower applicants
Fair credit Reporting Act FCRA
76
requires specific disclosures on loans with annual percentage rates (APRs) more than 6.5 percentage points above the average prime offer on first liens, and more than 8.5 percentage points above the average prime offer rate (APOR) on subsequent liens
Home Ownership and Equity Protection Act HOEPA
77
prohibit discrimination against loan applicants on the basis of race color religion, national origin, sex, marital status and age
Equal Credit Opportunity Act (ECOA) and its Regulation B
78
series of federal laws that prohibit discrimination in the sale, rental or financing of residential housing relating to the seven protected classes of individuals based on race color relifion, national origin, sex , familial status, or disability
Fair Housing Act
79
requires that specific information be made available to the public when mortgages are sold on the secondary market
Regulation C HMDA
80
requires disclosure of loan terms and percentage rates in a form that makes it easier for a consumer to compare competing loan products
Regulation Z TILA
81
requires the disclosure of fees and costs involved when closing home mortgages and prohibit abusive settlement practices
Regulation X: Real Estate Settlement Procedures Act (RESPA)
82
HMDA Regulation
C
83
ECOA Regulation
B
84
TILA Regulation
Z
85
RESPA Regulation
X
86
Packing is defined as:
- putting the borrower's interests above the interests of the loan originator
- using a lender's influence to force a borrower to refinance their loan
- adding fees to the loan amount without the borrower's informed consent
- requiring all financial conflicts to be settled by mandatory arbitration
C.
Fees
87
Which is NOT a common law fiduciary duty owed to a mortgage applicant or a borrower?
disclosure
loyalty
accounting
discrimination
```
D
Common law fiduciary duties are
care
loyalty
accounting
obedience
disclosure
```
88
The mortgage assistance relief services (MARS) rules apply to mortgage brokers who:
- receive compensation from the refinance of subprime loans.
- work for nonprofit organizations that provide down payment assistance
- originate more than 100 loans during the previous calendar year
- promote loan origination or refinancing as a way for homeowners to avoid foreclosure
D.
89
required US financial institutions to keep records of cash purchases of negotiable instruments and file reports of the purchases that were in the amount of more than $10,000
Bank Secrecy Act
90
the OFAC specially designated nationals list can be used to determine if a customer:
could be suspected as
money launderer
terrorist
illegal activities
91
a ___________ is an individual whose profile is used to serve as a cover for a loan transaction
mock signor
straw borrower
masked funder
power of attorney
Straw borrower
92
Which would appear in Section h (other) on page 2 of the Loan Estimate?
prepaid homeowner's insurance premiums
real estate broker commissions
transfer taxes
appraisal fee
```
B
Section H (other) includes:
appliance and system warranties
re broker commissions
owner's title insurance
debet cancellation coverage
```
93
What LE section would appraisal fee be listed under?
Section A (origination charges)
94
what LE section would transfer taxes be listed under?
Section E (taxes and other govt fees)
95
What LE section would prepaid homeowners insurance premiums be listed under?
Section F (prepaids)
96
The Comparisons table on Page 3 of the loan estimate sets forth the basic information relating to the loan in _____years.
5
| Can be used to compare loan products
97
on the projected payments section of the LE, what is the maximum number of payment calculation columns allowed?
four
98
on the LE all fees relating to title insurance policies should be in the format of:
"TI Policy-(item description)"
"[Title] (item description)"
"Title - (item description)"
"Title Insurance:(item description)"
C.
"Title - (item description)"
99
Which can be rounded to the nearest whole dollar when disclosed on the LE?
Estimated total monthly payment
monthly P&I
Loan amount
Homeowners insurance
A.
100
How many pages are in the LE Disclosure
3 pages
101
What are the 4 choices for the purpose line item on page one of the LE?
purchase
refinance
construction
home equity loan
102
The information an underwriter collects during the loan package review is called
Preliminary Underwriting Findings
103
The first document in the loan package that was prepared by the loan originator will be __.
Submission sheet
104
If an appraiser uses more than one approach to value the process of analyzing the differing values to determine an opinion of value is known as
correlation ore reconciliation of values
105
When determining the value of an apartment building, which approach to value would an appraiser use?
income capitalization approach
sales comparison approach
cost approach
market data approach
A.
106
The method of appraisal that carries the most weight in the valuation of a residential property is known as the
market data approach
107
Calculating the replacement cost for a building minus depreciation, then adding the value of the land is used by an appraiser in what approach to value
cost approach
108
Page 2 of the Closing Disclosure (DC)
Closing Costs Details Page
3 Columns
109
The columns of the Closing Costs Details Page
| of the CD
Borrower-Paid
Seller-Paid
Paid by Others
110
Calculating Cash to Close table is on what page of the CD?
page 3
111
What can you do if there are too many line items to disclose all on Page 2 of the CD?
Separate the Loan Costs table and Other Costs table into their own pages
Labeled as pages 2a and 2b
112
How many pages are in the CFPB standard closing disclosure?
5 pages
113
If delivery of the CD is by postal mail, it must be placed in the mail _______ before loan consummation.
6 business days
114
When is a loan transaction said to be closed?
the deed is recorded in the name of the buyer and the funds are made available to the seller
115
A consumer will receive a CD no later than ________ before loan consummation.
3 days
116
A settlement agent may also be referred to as:
an escrow officer
117
the 5 exceptions not covered by a standard title insurance policy are
1 taxes and assessments that do not appear as a lien
2 any interests or claims not shown on the public record but could be discovered by a simple visual observation or conversation with the property owner
3 easements and encumbrances not shown on the public record
4 other liens such as worker's comp or construction liens
5 discrepancies or boundary line disputes
118
A preliminary title report is a combination of
a title search and an abstract of title
119
a lawsuit pending regarding the title or possession of a specific property
lis pendens
120
A property that a borrower is looking to purchase may be subject to CC&R's also referred to as:
Covenants, Conditions, and Restrictions
121
Escrow agent duties:
order preliminary title report
secure payoff letters
issuing receipts for the deposit of docs and funds
122
Housing/Debt ratio for ARMs with 5% down
25/33
| 25% FMI for housing and 33% of GMI for overall debt
123
Housing/Debt ratio for temporary buy downs
28/33
124
Housing/Debt ratio for Conventional programs
28/36
125
Housing/Debt ratio for FHA
31/43
126
Housing/Debt ratio for VA
41
127
Payment Formula
P=(ixA) divided (1-(1+i)^-N)
i = interest rate divided by number of payments in the year
A = loan amount
N= number of payments over the life of the loan calculated as a negative number
the caret represents power of negative N
128
Pension can be credited to the income amount if it can be proved that they will receive it for _____or longer
at least 3 years
129
```
calculate Qualifying ratio
800 rent
199 car lease
80 Credit card
2000 GMI
```
40/54
housing ratio 800/2000=40%
debt ratio 800+199+80/2000=54%
130
Most accurate way to calculate hourly wages is
obtaining a Verification of Employment (VOE)
131
debt ratio calculation adds monthly liabilities to the housing expense, including:
car leases
revolving debt
child support/alimony
student loan payments
132
calculate loan amount
7.5% IR
monthly interest payment 1,250
1,250x12=15,000
15,000/.075=200,000
=200,000
