Chapter 4

Question 1

Federal law in place to help buyers compare the loan fees and other charges

Answer 1

Truth in lending act

Question 2

The truth in lending act is implemented by

Answer 2

Regulation z

Question 3

Regulation z applies to all loans secured by a residence but doesn’t apply to

Answer 3

Commercial loans

Agricultural loans over $25,000

Question 4

The provisions of reg z cover

Answer 4

Disclosure of costs
Right to rescind the transaction
Advertising offers
Non-compliance penalties

Question 5

What is the penalty for violation of the advertising of reg z

Answer 5

Twice the amount of the finance charge or a minimum of $100, up to a Max of $1000.
Also liable for court costs, attorney fees and any actual damages

Question 6

Requires that the parties to certain transactions receive the correct figures pertaining to their closing costs

Answer 6

Real estate settlement and procedures act

Question 7

RESPA applies to purchases:

Answer 7

Residential property
Involving first or second mortgages
Financed by a federally related loan (VA, FHA, HUD)

Question 8

RESPAS TRID rule applies to what type of purchases

Answer 8

Any closed end loan secured by real property including unimproved property

Question 9

What items are comment for the buyer to pay

Answer 9

Mortgage recording fees.
Title insurance
Appraisal fees
Credit fees
Survey
Loan organization
Attorney fees
Homeowners insurance
Reserved deposited with the lender, such as insurance, taxes, assessments
Private mortgage insurance

Question 10

What are items a seller usually pays

Answer 10

Brokers commission
Title fees
Fees for preparing deed
Attorney fees

Question 11

What do you call items that the seller has invited but have not been paid and how will they be handled on the settlement statement

Answer 11

These items are paid on arrears. The buyer will get a credit and the seller will get a debit

Question 12

When is the creditors generally required to provide the loan estimate

Answer 12

Within 3 days of the receipt of the consumers loan application

Question 13

Which of the following is not an item that a buyer usually pays for at closing?

Fee for clearing a title
Mortgage recording fees
Homeowners insurance
Title insurance policy

Answer 13

Fee for clearing a title

Question 14

RESPA covers loans secured with a mortgage placed on which of the following?

Commercial property
Industrial property
A one to four family residential property
Property financed by the seller

Answer 14

A one to four family residential property

Question 15

Amounts collected by the lender and held in a trust or. Impound account for future payment are called what

Advances
Impounds
Trust fund
Reserves

Answer 15

Reserves

Question 16

Which of the following items are paid in arrears

Taxes and insurances
Rents and interest
Taxes and interest
Rents and insurance

Answer 16

Taxes and interest

Question 17

Which of the following statements best describes the term consummation as defined by reg z

The time that a consumer becomes contractually obligated on a credit transaction
The window of time a consumer has to accept or reject a credit transaction
The amount of time a mortgage loan is viable
Three business days prior to acceptance of the loan

Answer 17

The time that a consumer becomes contractually obligated on a credit transaction

Question 18

What does a demand feature mean in mortgage loan

Would not allow the lender to require early repayment
Would allow the lender to require early repayment
Would allow the borrower to make an early repayment with a penalty
Would allow the borrower to shorten the life of the loan by making double monthly payments

Answer 18

A demand feature would allow the lender to require an early repayment