Loan origination Flashcards
Which loan types require counseling?
High cost loans, negative amortization loans, and FHA HECMs
Which disclosure booklet is required by RESPA?
Your home Loan Toolkit: A step by step guide, formerly known as the Settlement Cost Information Booklet
What type of loan requires a CHARM booklet?
Any adjustable rate mortgage
How soon must the CHARM booklet and the Home Loan Toolkit be sent to borrowers
Within three business days after completion of the application
When must an affiliated business arrangement be disclosed?
At the time of referral
How long constitutes a history of overtime?
Two years
How much can APR vary by before it must be redisclosed?
1/8 of one percent
How long to paid tax liens remain on a credit report?
Seven years
What goes into the front end ratio?
The monthly housing expense and gross monthly income, with the housing expense being given by the PITI payment
What goes into the back end ratio
The back end ratio is also known as the total debt ratio, and consist of totally monthly obligations to gross monthly income
What are the front and back end ratios for FHA loans?
31 and 43% respectively
What are the front and back end ratios for conventional loans?
28% and 36%
What is the combined loan to value?
The combined loan to value is used when applicants request a second mortgage and is calculated by combining the cost of all mortgages and comparing the combined cost to the value of the home
What loans are not subject to the ATR rule
Open-end home equity plans, reverse mortgages, bridge loans that are 12 months or less, construction loans, and loans made by a housing finance agency
What can a loan not do to abide by the Qualified Mortgage rule?
Have a term of more than 30 years, feature negative amortization, interest only, or balloon payments, or include points and fees that exceed the cap (based on loan amount)
