Chapter 6 Quiz: Federal Regulation (TILA/RESPA/TRID) Flashcards
The purpose of the Truth in Lending Law is to:
a. set maximum interest rates and loan costs
b. allow consumers to make credit or APR comparisons
c. prohibit secondary financing on federally related loans
d. all of the above
b. allow consumers to make credit or APR comparisons (p. 129)
The purpose of Truth in Lending Disclosure is to enable consumers to make credit comparisons between various credit sources (lenders) so that informed decisions can be possible by simply comparing APRs.
Who is responsible for compliance with the TILA?
a. the arranger of credit
b. the Bureau of Real Estate
c. the creditor/lender
d. the borrower
c. the creditor/lender (p. 131)
Under Truth in Lending, the creditor (party giving the loan) is responsible for compliance with the act.
Which of the following loans would be subject to the disclosures required under the Truth in Lending Act?
a. a credit sale where no finance charges are to be paid
b. a credit sale payable in three installments
c. both a and b
d. one-to-four unit owner-occupied property loans
d. one-to-four unit owner-occupied property loans
Which of the following is subject to Truth in Lending Disclosures?
a. agricultural loans
b. business loans
c. loans on property held for rental purposes
d. a $25,000 loan secured by the borrower’s residence
d. a $25,000 loan secured by the borrower’s residence (p. 133)
TRID is the acronym for:
a. The Right to Individual Disclosure
b. TILA-RESPA Integrated Disclosure Rule
c. Ten Rules in Disclosure
d. Trust Rights in Default
b. TILA-RESPA Integrated Disclosure Rule (p. 133)
When there is a change in circumstances after the loan estimate has been provided, the creditor can revise the Loan Estimate within how many business days?
a. 1
b. 3
c. 5
d. 7
b. 3 (p. 137)
When there is a changed circumstance after the Loan Estimate has been provided, the creditor can revise the Loan Estimate within three business days.
In a fixed interest rate product (loan), the Loan Estimate Form must include:
a. the loan amount
b. the interest rate, monthly principle and interest payment amount
c. whether there is a prepayment penalty or a balloon payment
d. all of the above
d. all of the above (p. 139)
The exact right of rescission time period when a consumer places a lien against his or her principal residence extends:
a. for 24 hours after the loan has been completed
b. until midnight of the third business day following the completion of the loan
c. for seven days after filing an application for a loan
d. until the loan has actually been funded
b. until midnight of the third business day following the completion of the loan
The “rescission rights” under truth in lending apply to:
a. purchase money loans
b. loans on commercial property
c. properties not used as a principal residence of the borrower
d. none of the above
d. none of the above
Trigger terms under the TILA advertising include all EXCEPT advertising the:
a. broker’s name
b. down payment
c. monthly payment
d. total finance charges
a. broker’s name (p. 130)
These trigger terms include, but are not limited to, the interest rate, down payment, loan period or number of payments, finance charges, or payment amounts.
