High Cost Mortgages (HOEPA)

Question 1

What three items have established thresholds for a “High Cost Mortgage” designation?

Answer 1

1. APR
2. Prepayment Penalty
3. Points and Fees

Question 2

APR Threshold for first-lien Mortgage

Answer 2

6.5% above average

Question 3

APR Threshold for junior-lien Mortgage

Answer 3

8.5% above average

Question 4

Points and Fees threshold for loans less than $22k

Answer 4

5% of total loan amount

Question 5

Points and Fees Threshold for loans greater than $22k

Answer 5

Lesser of 8% total loan amount or $1,103

Question 6

Prepayment Penalty threshold

Answer 6

1. In place for more than 36 months after consummation

2. Exceeds 2% of prepayment amount

Question 7

HOEPA is enacted as part of

Answer 7

TILA

Question 8

Closed-end loans with rates that exceed the average prime offer rate, but are not high enough to trigger protections under HOEPA, are known as:

Answer 8

Higher Priced Mortgage Loans