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NMLS+ > Day 4 > Flashcards

Day 4 Flashcards

1
Q

8 Factors of ATR that must be verified:

A
  1. Employment Status
  2. Mortgage Payments for new loan
  3. Payments on subordinate liens
  4. Monthly taxes & Insurance
  5. Income & Assets
  6. Debts, alimony & child support
  7. DTI ratio
  8. Credit History
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2
Q

4 requirements of Qualified Mortgage (AAA):

A
  1. Must be fully amortizing (no I/O, neg amor, or balloons)
  2. Must not exceed 30y term
  3. Points and fees do not exceed 3% of LOAN amount
  4. APR is
    -less/equal to 1.5% + APOR for CONFORMING/GOVERNMENT
    -less/equal to 2.5% + APOR for JUMBO loans
    -less/equal to 3.5% + APOR for SUBORDINATE loans
    (presumption of compliance)
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3
Q

2 requirements of HPML (BBB):

A
  1. 3% < Points and fees </= 5% (of loan amount)
  2. APR > 1.5% + APOR for CONFORMING (gov must be QM)
    > 2.5% + APOR for JUMBO
    > 3.5% + APOR for SUBORDINATE
    (rebuttable presumption of compliance, close-end loans)
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4
Q

2 requirements for High Cost (HOEPA/unrated):

A
  1. Points and fees > 5% (of loan amount)
  2. APR > 6.5% + APOR for 1st Lien
    > 8.5% + APOR for 2nd Lien
    (no presumption of compliance, close and open-end loans)
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5
Q

What 2 sections of TILA relate to HPML/HOEPA?

A
  1. Sec 35- HPML
  2. Sec 32- HOEPA
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6
Q

Who oversees GSEs and what do they do?

A

FHFA , determines loan limits

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7
Q

5 requirements for CONFORMING loan:

A
  1. <$647,200
  2. 620 min credit score
  3. LTV: 95% PURCHASE/R&T (5% down)
    80% CASH OUT
  4. 3 types of OCCUPANCY
  5. SELLER’S CONCESSIONS
    -3% sales price if <10% down
    -6% sales price if </=25% down
    -9% sales price if >25% down
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8
Q

Ability to Repay

A

Reg by CFPB that lenders make good faith determination that borrower can repay loan

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9
Q

Payment shock

A

Sudden increase in monthly payment than borrower can afford

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10
Q

Qualified Mortgage

A

meets requirements under Dodd-Frank Wall Street Reform and Consumer Protection Act to be sold to Fannie/Freddie

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11
Q

Safe Harbor

A

Protect lenders against lawsuits thanks to QMs

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12
Q

Mortgage Market

A

marketplace where home loans and servicing rights are bought and sold between lenders and investors

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13
Q

Service Release Premium

A

Payment received by lender when closed loan sold to secondary market

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14
Q

Mortgage-Backed Security

A

Pool of asset-backed securities originated to AAA/BBB standards

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15
Q

Securitization

A

Selection of debt that is to be pooled (residential mortgages)

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16
Q

Servicer

A

Company to which the note and mortgage documents are sold or transferred from the originating company

17
Q

5 types of NON-CONFORMING loans:

A
  1. Jumbo
  2. 2nd Mortgages- HEIL, HELOC, Piggyback
  3. Stated Income (no longer allowed under Dodd Frank)
  4. Subprime loans (<580 credit)
  5. Negative amort/Option ARMS
18
Q

3 NON-CONVENTIONAL loan programs:

A
  1. FHA- HUD
  2. VA- Dep of VA
  3. USDA- Dep of Treasury
19
Q

Assumption Clause

A

Non Vets can take over VA loan

20
Q

8 requirements of GOV loans:

A
  1. registered with CASE #
  2. Require ESCROW
  3. Only 1 GOV loan at a time
  4. Must be PRIMARY RES
  5. Eligible for ASSUMPTION CLAUSE
  6. INSURED/GUARANTEED
  7. NO 2nd financing
  8. Down payment funds can only be gifted from non-profit or family
21
Q

How much is UFMIP for FHA?

A

1.75%

22
Q

Monthly MIP for FHA (3)

A
  1. either .8% or .85%
  2. > 90% LTV- MIP for life
  3. <90% LTV- MIP for 11 years
23
Q

FHA Streamline (4)

A

refinance FHA loan with less documentation
1. Rate and Term only
2. Closing costs and escrow can’t be rolled into loan
3. Had prior FHA loan for 6+ months
4. portion of UFMIP refunded and credited towards new loan

24
Q

FHA DTI:
Min Down:
Min FICO:
Sellers Concessions:
Cashout LTV:

A

31/43
3.5% (10% if 500-579)
580
max 6%
80%

25
Q

Which loan doesn’t require ATR?

A

HECM

26
Q

FHA: 6 HECM characteristics:

A
  1. must pay UFMIP and MIP
  2. 62+ years old
  3. primary residence
  4. negative amortization
  5. HUD approved counseling
  6. Loan due if owner dies
27
Q

FHA: 2-1 Buy Down

A

(we don’t do these)
Two initial temporary start interest rates that increase in stair -step fashion to permanent rate.
2 points>1 point>0 points

28
Q

VA: Max Entitlement Amount (3)

A
  1. $36k (min) </= $144k >/= 25% of loan amount
  2. Paid to lender in foreclosure
  3. If loan exceeds county limit, put down 25% of excess
29
Q

VA: Funding Fee (4)

A
  1. Can be rolled into loan
  2. .5% to 3.6%
  3. 2.3% for first time, no money down
  4. Disabled vet or surviving spouse DOES NOT PAY
30
Q

VA: Streamline (5)

A
  1. Interest Rate Reduction Refinance Loan
  2. Rate and Term refi only
  3. Can roll cost into loan
  4. No COE
  5. No Appraisal
31
Q

USDA characteristics (5)

A
  1. Rural/residential only
  2. 2% Guarantee fee can be rolled into loan
  3. .3% Annual fee (paid monthly)
  4. No limit on concessions
  5. No down payment required
32
Q

Mortgage Loan Timeline (8)

A
  1. Initial Call (what do they want?)
  2. ALIENS
  3. Initial Disclosures (LE, GFE, client gives Intent to Proceed)
  4. Application (URLA 1003)
  5. Processing and Underwriting
  6. 3rd Party Verification (insurance, appraisal)
  7. Closing (title company)
  8. Servicing

NMLS+ (7 decks)

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