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Flashcard - 1-100 > Laws > Flashcards

Laws Flashcards

1
Q

What law deals with credit,APR & Advertising of consumer loans?

A

TILA/REG Z

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2
Q

Which regulation prohibits kickbacks?

A

Respa Section 6

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3
Q

Which regulation requires the lender to cancel PMI when the loan reaches 78% LTV

A

HPA- Homeowners Protection Act

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4
Q

Which regulation prohibits fee splitting?

A

Respa

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5
Q

X is the letter used to describe which regulation?

A

Respa

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6
Q

RESPA is the acronym to describe which law

A

Real estate settlement procedures act

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7
Q

What type of mortgage requires a non refundable funding fee?

A

VA loan

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8
Q

What is the provision enabling a lender to demand full repayments if the borrower defaults on the loan

A

Acceleration Clause

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9
Q

What is the provision in a mortgage enabling a lender to demand full repayment if the borrower transfers the loan

A

Alienation Clause

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10
Q

What does CFPB stand for?

A

Consumer Financial Protection Bureau

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11
Q

What two laws created CFPB

A

Dodd Frank and Consumer Finace Protection Act

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12
Q

Which regulation is designed to help meet the credit needs of the communities in which it operates?

A

Community reinvestment Act

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13
Q

Under ECOA rules and regulations how many days does the borrower have to request a copy of an appraisal report if the application was denied?

A

90 days

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14
Q

Under ECOA rules and regulations if an application for credit is denied and if the borrower requests a copy, the lender has how many days to provide a copy of the appraisal?

A

30 days

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15
Q

If a loan application is approved, under ECOA when must a copy of the appraisal be provided to the borrower

A

3 business day prior to settlement

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16
Q

Conforming loans follow the guidelines of which regulators

A

Fannie and Freddie

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17
Q

Which regulation requires the lenders to be equal when extending credit to borrowers

A

ECOA - Regulation B

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18
Q

How old must a borrower be to qualify for a reverse mortgage

A

62 years

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19
Q

Which regulation has the primary function of preventing identity theft?

A

Fact Act

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20
Q

Which regulation has section 114 rules?

A

Fact Act

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21
Q

Which regulation requires the creditor to verify the validity of any changes of address received?

A

Section 114 of Fact Act

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22
Q

What is the payment method used in reverse mortgages that allow the homeowners to receive a monthly check while living int h property

A

Tenure Method

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23
Q

What is the fraud scheme where a borrower use someone else’s name to purchase the property but that person will not be living at the property?

A

Straw buyer/Nominee buyer

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24
Q

What type of lender insures mortgages

A

FHA approved lenders

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25
Q

What type of lender guarantees mortgages

A

VA & USDA approved lenders

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26
Q

What is the entity that
loans money to fund
purchases in rural areas?

A

USDA/Dept. of

Agriculture

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27
Q

What is the value
remaining in property
after all liens and debts
have been paid?

A

Equity

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28
Q

A borrower is refinancing
his home. How much time
does Reg Z give him to
change his mind (rescind)?

A

3 days

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29
Q

Which Regulation
established the 3-day
right of rescission rule?

A

TILA/REG Z

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30
Q

Redlining is part of

which regulation/Law?

A

Fair Housing Act

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31
Q

Blockbusting is part of

which regulation/Law?

A

Fair Housing Act

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32
Q

Steering is part of which

regulation/Law?

A

Fair Housing Act

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33
Q 
Trying to convince a
homeowner to SELL his home
by implying that another
race/ethnicity is moving in the
neighborhood is called?
A

Blockbusting/panic

selling

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34
Q 
Trying to convince a
homeowner to PURCHASE in
a particular neighborhood based
on his race, religion or ethnicity
is called?
A

STEERING

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35
Q 
Refusing to make loans on a
property in a certain
neighborhood for
discriminatory reasons is
called?
A

Redlining

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36
Q

What does HOEPA stand

for?

A

Home Ownership and

Equity Protection Act

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37
Q

HOEPA Loans are part
of which larger
regulation?

A

Reg Z/TILA

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38
Q

High Cost Loans are part
of which larger
regulation?

A

Reg Z/TILA

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39
Q

High Priced Loans are
part of which larger
regulation?

A

Reg Z/TILA

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40
Q

Section 32 Loans are part
of which larger
regulation?

A

Reg Z/TILA

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41
Q

Section 35 Loans are part
of which larger
regulation?

A

Reg Z/TILA

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42
Q

MDIA ACT is part of

which larger regulation?

A

Reg Z/TILA

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43
Q

Mortgage Disclosure
Improvement Act is part
of which larger
regulation?

A

Reg Z/TILA

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44
Q

What is another name for

Annual Percentage Rate?

A

Effective Rate

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45
Q

What is another name for

Interest Rate?

A

Note Rate or Nominal

Rate

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46
Q

PITI divided by Gross
Monthly income is
referred to as what?

A

Housing Ratio or Front-

End DTI

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47
Q

PITI + monthly debt
divided by Gross
Monthly income is
referred to as what?

A

Total Obligation Ratio –

Back-end Ratio

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48
Q

How long must TILA

Disclosures be kept?

A

2 years

(exceptions – LE is kept
for 3 years and CD is
kept for 5 years)

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49
Q

What is the maximum
amount of time that
NEGATIVE info can
remain on a credit report?

A

7 years

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50
Q

What is the maximum
amount of time that a
bankruptcy can remain
on a credit report?

A

10 years

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51
Q

Which law/regulation states
that a Bankruptcy can only
remain on your credit for a
MAX of 10 years?

A

FCRA – Fair Credit

Reporting Act – Reg V

52
Q

Which law/regulation states
that negative information can
only remain on your credit for
a MAX of 7 years?

A

FCRA – Fair Credit

Reporting Act – Reg V

53
Q 
Which law allows a consumer
who has had her credit card
used by an identity thief to place
a credit freeze on her credit
report?
A

FACT ACT

54
Q

Which law requires
creditors to TRUNCATE
debit and credit card info
on receipts?

A

FACT ACT

55
Q 
Which regulation requires that loan
officers must take measures to
secure and dispose of (burn and/or
shred) a borrower’s sensitive credit
information?
A

FACT ACT

56
Q 
Which regulation states
that if a borrower is
denied credit, he can
receive a FREE copy of
his credit report?
A

FCRA – Fair Credit
Reporting Act
REG V

57
Q

Which regulation states that if
a borrower is unemployed, he
can receive a FREE copy of
his credit report?

A

FCRA – Fair Credit

Reporting Act – Reg V

58
Q 
Which regulation states that if
a borrower is on SSI or
Disability, he can receive a
FREE copy of his credit
report?
A

FCRA – Fair Credit

Reporting Act – Reg V

59
Q 
Which regulation states that if
a borrower has been the
victim of fraud, he can
receive a FREE copy of his
credit report?
A

FCRA – Fair Credit

Reporting Act – Reg V

60
Q 
Which regulation states that a
borrower can receive a FREE
copy of his credit report once a
year (no reason or requirement
necessary)?
A

FACT Act

61
Q

During the loan process,
if you ask a borrower if
he is single…which law
are you violating?

A

ECOA – Regulation B

62
Q 
Which regulation states that the
only correct way to ask about a
borrower’s marital status is: are
you married, unmarried or
separated?
A

ECOA – Regulation B

63
Q

Who is responsible for
providing the closing
disclosure to the
borrower?

A

The Creditor/Lender

64
Q

Who is responsible for
providing the closing
disclosure to the Seller?

A

Settlement Agent/Title

Agent

65
Q

Which regulation
requires the borrower to
receive the Loan
Estimate?

A

TILA – REG Z

66
Q

Which regulation
requires the borrower to
receive the Closing
Disclosure?

A

TILA – REG Z

67
Q

Which regulation requires
the borrower to receive the
Loan Estimate within 3
business days?

A

RESPA – Regulation X

68
Q

Which regulation requires
the borrower to receive the
Closing Disclosure within
3 business days?

A

RESPA – Regulation X

69
Q

As it relates to the loan
estimate – what is the
definition of a Business
day?

A

Any day that the
Creditor’s office is open
for business

70
Q

According to TILA/REG
Z – what is the definition
of a Business day?

A

Any calendar day except
for Sunday and Legal
Holiday

71
Q

During the loan process,
where do you find
HMDA government
monitoring information?

A

Section X of the 1003

application

72
Q

What does HMDA stand

for?

A

Home Mortgage

Disclosure Act

73
Q 
What appraisal approach is
used when appraising
property that has been
destroyed by a natural
disaster?
A

Cost Approach or
replacement cost
approach

74
Q

In the sales comparison
approach, how many
comps are required?

A

3

75
Q

What is another name for
the Financial Services
Modernization Act of
1999?

A

Graham Leach Bliley

Act

76
Q 
How many days does a
CREDITOR have to notify a
consumer of the status of a
credit application (denied,
approved, need more info)?
A

30 days

77
Q 
Which regulation states
that a creditor has 30 days
to notify a consumer of an
application approval or
denial?
A

ECOA – REG B

78
Q

How many hours of
Ethics is required to be
taught in the 20hr
Pre-licensing course?

A

3

79
Q

How many hours of Ethics
is required to be taught in
the 8hr Continuing
Education course?

A

2

80
Q

How many hours of
Federal Law is required
to be taught in the 20hr
Pre-licensing course?

A

3

81
Q

A mortgage that includes
more than one parcel of
land is called what?

A

Blanket Mortgage

82
Q

A mortgage that includes
appliances such as a
stove or refrigerator is
called what?

A

Package Mortgage

83
Q 
Which closing document
itemizes the final closing
cost and items paid in
connection with the loan
for the borrower?
A

Closing Disclosure

84
Q

Which law deals with
APR and Advertising of
credit terms?

A

TILA – REG Z

85
Q

What is the official

name for the 3/7/3 rule?

A

Mortgage Disclosure
Improvement Act or
MDIA Act

86
Q

What regulation requires
the lender to perform an
escrow analysis?

A

RESPA – REG X

87
Q

Which law states that it is a
violation to discriminate
against a potential borrower
on public assistance?

A

ECOA – REG B

88
Q

What two classes are
protected under Fair
Housing Act - but NOT
under ECOA?

A

Disability/Handicap &

Familial Status

89
Q

What three classes are
protected under ECOA
but NOT under Fair
Housing?

A

Age, Marital Status, and

Public Assistance

90
Q

What is another name for

a non-conforming loan?

A

Jumbo Loan

91
Q

What is another name for

a Jumbo loan?

A

Non-Conforming Loan

92
Q

The front Ratio for an
FHA loan is 31%… what
is the back ratio?

A

43%

93
Q

The front Ratio for a
Conventional loan is
28%… what is the back
ratio?

A

36%

94
Q

The Ratio for a VA loan

is?

A

41%

95
Q

What is another name for

the Bank Secrecy Act?

A

The anti-money

laundering act

96
Q

What is another name for
the Anti-Money
Laundering Act

A

Bank Secrecy Act

97
Q

Which law requires banks
(financial institutions) to
keep records of deposits of
$10,000 made in cash?

A

Anti-Money Laundering

Act/Bank Secrecy Act

98
Q 
Which law requires MLOs to file
suspicion activity that might be a
sign of tax evasion, money
laundering, or other possible
criminal activity exceeding $5,000.
A

Anti-Money Laundering

Act/Bank Secrecy Act

99
Q

If you fail the test, how
long must you wait
before retaking the
exam?

A

Required 30-day waiting
period before retaking a
failed test

100
Q 
How many hours of
Federal Law is required to
be taught in the 8hr
Continuing Education
course?
A

3

101
Q

What does AUS stand

for?

A

Automated Underwriting

System

102
Q

What does SAFE Act

stand for?

A

Secure & Fair

Enforcement Act

103
Q

What does HERA stand

for?

A

Housing & Economic

Recovery Act

104
Q

What does HPA stand

for?

A

Homeowner’s Protection

Act

105
Q

What does GLBA stand

for?

A

Graham Leach Bliley Act

106
Q

What type of property is

covered under RESPA?

A

1 – 4 unit Residential Property

107
Q

Which regulation allows lenders to
OBTAIN information regarding a
borrower’s ethnicity, to help identify
possible discriminatory patterns?

A

HMDA – Regulation C

108
Q

When can a borrower
request cancellation of
PMI?

A

When LTV Reaches 80%

109
Q

When must the lender
automatically cancel
PMI?

A

When the LTV reaches 78%

110
Q

What is the primary market?

A

Where borrowers/consumers

obtain mortgage loans

111
Q

What is the secondary

market?

A

Where lenders buy &
sell loans from one
another

112
Q

Name the two
Government Sponsored
Enterprises (GSEs)?

A

Fannie Mae

Freddie Mac

113
Q

Which GSE is the
Federal National
Mortgage Association?

A

Fannie Mae

114
Q

Which GSE is the
Federal Home Loan
Mortgage Association?

A

Freddie Mac

115
Q

TILA applies when credit
is payable by written
agreement in __________

installments?

A

More than 4 installments

116
Q

Which AUS system does

Fannie Mae use?

A

Desktop Underwriter

DU

117
Q

Which AUS system does

Freddie Mac use?

A

Loan Product Advisor
(formerly Loan
Prospector)

118
Q

How often must
National DNC and
internal DNC list be
updated?

A

Every 31 days and
records must be
maintained for 24
months

119
Q

An appraisal is valid for

_____ months?

A 
An appraisal is valid for 6
months (updated 1/1/2020). It
must be re-certified if the
appraisal will be 4 months (120
days) old or more at closing.
120
Q

What is the penalty for

violating the DNC list?

A

$42,530 now it is 43280 per call

121
Q

Which regulation allows
the borrower to sue for
3x’s the amount paid for
title insurance?

A

RESPA Section 9

122
Q

If money was collected,
and a borrower rescinds,
how long does escrow
have to return the funds?

A

20 days

123
Q 
MLOs seeking to become licensed in
other states or who seek to move
from a bank to a non-bank lender
will be allowed \_\_\_\_ days of
transitional (temporary) authority.
A

These individuals are allowed to originate loans while completing any state-specific requirements for licensure such as education or testing for up to 120 days while they are applying to the state agency for their new
license.

124
Q

What is the only fee that
can be collected prior to
delivery of the Loan
Estimate?

A

Credit Reporting fee

125
Q

Once an individual is unlicensed for
________ years as an MLO, most states require that the individual retake the 20 hrs of pre-licensing education in order to have his MLO license reinstated.

A

Once an individual is unlicensed for
three (3) years as an MLO, most states require that the individual retake the 20 hrs of pre-licensing education in order to have his MLO license reinstated.

Flashcard - 1-100 (1 decks)

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