MLO Flashcards
1
Q
Conventional Front End Ratio
Housing Expense Ratio (HER)
A
28%
2
Q
Conventional Back End Ratio
Total Obligation Ratio (TOR)
or DTI (Debt To Income)
A
36%
3
Q
USDA Front End Ratio
Housing Expense Ratio (HER)
A
29%
4
Q
"USDA Back End Ratio Total Obligation Ratio (TOR) or DTI (Debt To Income)"
A
41%
5
Q
VA Front End Ratio Housing Expense Ratio (HER)
A
0%
6
Q
"VA Back End Ratio Total Obligation Ratio (TOR) or DTI (Debt To Income)"
A
41%
7
Q
FHA Front End Ratio Housing Expense Ratio (HER)
A
31%
8
Q
"FHA Back End Ratio Total Obligation Ratio (TOR) or DTI (Debt To Income)"
A
43%
9
Q
Conventional Down Payment
A
“3% First time buyer
5% Others (subsequent purchases)”
10
Q
According to Conventional loans when are you considered a 1st time home buyer after you have purchased a home previously?
A
You are considered a 1st time home buyer if you have not owned property in 3 years (36 months)
11
Q
USDA Down Payment
A
0
12
Q
VA Down Payment
A
0
13
Q
FHA Down Payment
A
3.5% for credit scores 580 and above OR 10% for credit scores 500-579
14
Q
Conventional Seller Concessions
A
“Seller Concessions/Seller Closing Costs/Seller Contribute on the LOWER of the APPRAISAL or PURCHASE PRICE
90.1%+ (LTV) is 3%
75.1% - 90% (LTV) is 6%
75% (LTV) & under is 9%
2% for Investment Property
**Tip the more the buyer puts down the more the seller can contribute”
369 Get low!
15
Q
USDA Seller Concessions
A
“Seller Concessions/Seller Closing Costs/Seller Contribute on the LOWER of the APPRAISAL or PURCHASE PRICE
6%”
16
Q
VA Seller Concessions
A
“Seller Concessions/Seller Closing Costs/Seller Contribute on the LOWER of the APPRAISAL or PURCHASE PRICE
4%”
17
Q
FHA Seller Concessions
A
“Seller Concessions/Seller Closing Costs/Seller Contribute on the LOWER of the APPRAISAL or PURCHASE PRICE
6%”
18
Q
Conventional Late Fees
A
5% of Principle & Interest ONLY
19
Q
USDA Late Fees
A
4% of Principle & Interest ONLY
20
Q
VA Late Fees
A
4% of Principle & Interest ONLY
21
Q
FHA Late Fees
A
4% of Principle & Interest ONLY
22
Q
Conventional bankruptcy waiting periods
A
“Chapter 13 wage earner’s plan - 2 years
Chapter 7 - 4 years
Foreclosure - 7 years
Short Sale - 4 years”
23
Q
USDA bankruptcy waiting periods
A
Chapter 13 - 1 years
Chapter 7 - 3 years
Foreclosure - 3 years
Short Sale - 3 years
24
Q
VA bankruptcy waiting periods
A
Chapter 13 - 1 years
Chapter 7 - 2 years
Foreclosure - 2 years
Short Sale - 2 years
25
FHA bankruptcy waiting periods
"Chapter 13 - 1 years
Chapter 7 - 2 years
Foreclosure - 3 years
Short Sale - 3 years"
26
Conventional loans have private mortgage insurance until what LTV?
80% consumer can request removal
78% (conforming loans) PMI drops off
77% (non-conforming loans) PMI drops
27
Conventional loans have private mortgage insurance until what equity level?
22%
28
Are Conventional loans assumable?
No - they have a due on sale clause
29
What percent level of financing do USDA loans have?
100%
30
A USDA loan applicant may have an income up to what?
115% of the Median Income
31
Do USDA loans have an upfront funding fee?
Yes
32
Do USDA loans require private mortgage insurance?
No
33
Who are USDA loans funded by?
Department of Agriculture
34
Do USDA loans have a prepayment penalty?
No
35
What is a DD-214?
Discharge papers or report of separation
36
What type a loan requires a DD-214 or LES (Leave & Earning Statement)?
All VA loans
37
Who Issues the DD-214
Department of Defense
38
What is a NGB 22/23
"Is what is given for active Air National Guard or Army reservists with at least 6 or more years of service.
**HINT - NG think National Guard"
39
What is a COE?
Certificate of Eligibility - Shows the Veterans amount of entitlement
40
What is Entitlement?
The maximum total that the VA will “guarantee” on behalf of the Veteran.
41
What is the Veterans entitlement based off from?
Veterans entitlement is based on 25% of the County Limit.
42
What is the VA funding fee on a first time use of a VA loan?
2.30%
43
What are 3 reasons that the funding fee would be waived?
If the Veteran is more than 10% disabled, the applicant is a surviving spouse of a veteran, or if the veteran is a Purple Heart Recipient
44
Are VA loans assumable?
Yes
45
What is the down payment for a VA Loan
0
46
Do VA loans have prepayment penalties?
No
47
If the Veteran is married, can the spouse's income be considered for qualification purposes?
Yes
48
Are unmarried co-borrowers allowed on a VA loan?
No, unless he or she is also eligible Veteran who will reside in the home.
49
What are the 2 types of appraisals used for VA loans?
"CRV - Certificate of Reasonable Value
| NOV - Notice of Value"
50
What is the upfront MIP (mortgage insurance premium) for a FHA loan?
"1.75%
| This is included on 15 and 30 year purchase AND refinances"
51
When must a person using a FHA loan take occupancy in the home if it is purchased as an owner occupied?
Within 60 days of signing
52
What percentage of the loan does FHA insure?
100%
53
Are FHA loans assumable?
Yes
54
Do FHA loans require a certain appraiser?
Yes, they must be FHA approved
55
Do FHA loans have a maximum amount?
Yes, it is determined in each county TIP this amount does NOT include the UFMIP
56
If the LTV of a FHA loan is <90% how long does MIP (mortgage insurance premium) last?
11 years
57
If the LTV of a FHA loan is >90% how long does MIP (mortgage insurance premium) last?
The life of the loan
58
Resale of a FHA loan in 90 days or less after closing will not be eligible for another FHA mortgage.
TRUE
59
Resale of a FHA loan occurring 91-180 days after closing will be eligible for resale if what happens?
If an additional FHA appraisal is obtained.
60
Resales of a FHA loan after 90 days to 1 year after closing will be subject to what?
An additional review to establish value.
61
Section 35 is what?
HPML - High Priced Mortgage Loan
62
What are the percentages for a HPML?
"1.5% - First Lien
2. 5% - Jumbo First Lien
3. 5% - Subordinate Liens
TIP: Section 35 has the 3.5%"
63
What are the 3 rules that go with a HPML?
"1: Must have the Ability To Repay
2: No Prepayment penalty (unless in the first 2 years)
3: Require Escrow (Tax & Hazard Insurance) for the first 5 years TIP: APE"
A - ATR
P - Prepay penalty none (2yrs)
E - Escrow required
64
What type of loans fall under HOEPA? (Home Ownership & Equity Protection Act)
HCML - High Cost Mortgage Loans
65
What are the percentages for a HCML?
6. 5% First Liens of more than 50K
8. 5% First Liens under 50K
8. 5% on Subordinate Liens
66
What are the 4 rules that go with a HCML?
"1: Most Balloons Prohibited 2:Must meet the Ability to repay
3: No Prepayment penalty allowed
4: Must Speak to a HUD Counselor
```
TIP: BAPS"
B - Ballon prohibited
A - ATR
P - prepayment penalty prohibited
S - speak to counselor
```
67
Can a HCML include a variable rate?
Yes
68
What is the 1003?
"URLA Uniform
Residential Loan Application Loan Application"
69
What is the 1004?
"URAR
| Uniform Residential Appraisal Report"
70
How long is the appraisal good for?
6 Months - but must be recertified at 4 months
71
What form is used to recertify an appraisal?
Form 442
72
What is the 1005
VOE - Verification of Employment / Payroll
73
What is the 1006
VOD - Verification of Deposit / Bank Statements
74
What is the 1007
VOR - Verification of Rent
75
What does the VOR provide?
This form is intended to provide the appraiser with a familiar format to estimate the market rent of the subject property.
76
What is the 1008
Transmittal Summary
77
What does the Transmittal Summary Do?
This is the top sheet sent to the underwriter to describe the file in detail.
78
What is the 1009?
Form used in a Reverse Mortgage
79
What are the 8 protected classes of ECOA?
```
Sex
Color
Race
Origin (National)
Religion
Marital Status
Age
Public Assistance
(SCORR - MAP)
```
80
What are the 7 protected classes of FHA?
```
Sex
Color
Race
Origin (National)
Religion
Family Status
Handicap/Disability
(SCORR - FH)
TIP FHA has the FH after SCORR
```
81
What is the HUD equal access rule?
"HUD Equal Access Rule states that a lender cannot inquire about a borrowers sexual orientation or gender identity.
*Note this is part of SEX category"
82
What are the 6 items that create a complete application?
1: Address
2: Loan Amount
3: Income
4: Estimated Value
5: Name
6: Social Security Number"
TIP: ALIENS or PENCIL
83
What 3 times are covered under the GLBA?
Safeguarding Policies
Pretexting Policies
Financial Privacy Policies
TIP: GLBA has SPF
84
TRID does not apply to what 4 things?
1: HELOCs
2: All Cash Sales
3: Reverse Mortgages
4: Mobile Homes not secured by real estate
TIP: HARM
85
Types of Liquid Assets
```
Cash (Bank Accounts)
U.S. Treasury Bills (T-Bills)
Bonds or Notes
Mutual Funds
Money Market Funds
Stocks
Retirement investment accounts (401K's or IRA's)
```
86
Types of NON-liquid Assets
```
Art
Land
Real Estate Investments
Equipment
Jewelry Collectibles Antiques
Vehicles
```
87
What is Fannie Mae's AUS System? (Automated Underwriting System)
DU - Desktop Underwriter
88
What is Freddie Mac's AUS System? (Automated Underwriting System)
LPA - Loan Product Advisor
89
What is USDA's AUS System? (Automated Underwriting System)
GUS - (Guaranteed Underwriting System)
90
What is FHA's AUS System? (Automated Underwriting System)
Total Scorecard
91
What are 7 Valid Change In Circumstances?
```
"Act of GOD Appraised
Value Comes In Low
Change In Loan Program
Credit Score Declines
Change In Loan Amount
Change in Loan Terms
Seller Delay In Short Sale Approval"
```
92
What are the 2 types of Freehold Estates?
Fee Simple & Life Estate
93
What is the Highest Freehold Estate?
Fee Simple - A buyer owns the land and
| all the improvements to the land.
94
What are the 12 types of Clauses?
```
Due on Sale Clause (SOLD)
Alienation Clause (Transferred)
Acceleration Clause (Default)
```
Prepayment privilege clause (Pay off Early)
Prepayment penalty clause (No Pay off Early)
Exculpatory clause (Assets) Deficiency Judgement (go after Assets)
Defeasance clause (Defeat mortgage)
Escalation clause (Rate Rising)
Partial Release Clause (Parcel in parts)
Open-end clause (Future Advances)
Subordination clause (Senior -> Junior lien)
Power of Sale Clause
95
What is included in the Escrow Account?
Real Estate Taxes Homeowners Insurance PMI (if applicable)
96
What is the MCR
The MCR (mortgage call report) is a quarterly report of the condition of the business.
97
Where is the MCR Submitted?
Through the NMLS
98
The MCR has 2 levels - What are they?
"Residential Mortgage Loan Activity Report &
| Financial Condition Report"
99
What is the Residential Mortgage Loan Activity Report?
Report completely quarterly, within 45 days of the end of the calendar quarter
100
What is the financial Condition Report?
Report completed annually, within 90 days of the company's fiscal year end.
101
What are the 5 Federal Banking Agencies?
1. The CFPB
2. The Federal Reserve
3. National Credit Union Administration(NCUA)
4. Comptroller of the Currency
5. Federal Deposit Insurance Corporation(FDIC)
102
3 Types of Concurrent Real Estate Ownership?
```
Tenancy in Common
Joint Tenants (Can't sell the joint) Tenants in Entirety (Married Couple)
```
103
Types of Loss Mitigation
```
Loan Modification
Short Sale
in Lieu of Foreclosure
Forbearance
Deed
```
104
Reasons a reverse mortgage becomes due.
- Homeowner dies
- Sell the home
- Defaults on their taxes
- The owner lets the home deteriorate
- Does not live in the home for 12 consecutive months"
- Defaults on their insurance
105
What is an IRRRL
Interest Rate Reduction Refinance for VA loans
106
7 Types of bad loans
```
"Alt-A
No Doc Loans Subprime Loans
NINA (No Income No Assets)
NIVA (No Income Verified Assets)
SISA (Stated Income Stated Assets)
SIVA (Stated Income Verified Assets)
VBM (Variable Balance Mortgage)"
```
107
A Subprime borrower may have 1 or more of the following items?
"A bankruptcy in the last 5 years A foreclosure in the last 24 months
One or more 60 day delinquencies in the last 24 months"
108
Items included in Escrow
"Real Estate Taxes
| Insurance (HOI - Homeowners Insurance) PMI (if applicable)"
109
TRID (LE&CD) does not apply to?
```
HARM
HELOCs
All Cash Sales
Reverse Mortgages
Mobile Homes (not secured by real estate)
```
110
What does RESPA not deal with?
```
BCC NAVITA
Bridge Loans
Commercial Loans
Construction Loans
Non-Owner Occupied Properties
Agriculture - 25+ Acres of land
Vacant Land
Investment Properties
Temporary Financing
All Cash Sales
```
111
3 Types of Construction Disbursements
VFW Voucher
Fixed
Warrant
112
5 Indices
```
Prime US Treasury
COFI (cost of Funds Index)
SOFR (Secured Overnight Financing Rate)
**SOFR was previously
LIBOR
COSI (Cost of Savings Index
```
113
4 Types of Land Survey
Monument Method
Government Land Survey
Lots & Blocks
Metes & Bounds
114
What is the most commonly used type of land survey?
Lots & Blocks
**Tip Remember there are LOTS AND
LOTS of baby BLOCKS They are very common
115
What is the most accurate form of land survey?
"Metes & Bounds
| ** Tip if you order a steak (your mete) you want it to be cooked accurately"
116
What 4 items make a valid contract?
Competent Party
"Consideration Mutual
Agreement Legal Object
**TIP - remember this sentence: Competent parties are considering a"
mutual agreement for a legal object)
117
How long do you keep documents?
ECOA - 25 Month
"DNC - 2 Years
MAP - 2 Years
TILA - 2 Years
Escrow Cancellation - 2 Years
Partial Payment Policy - 2 Years
MCR - 2 Years
The 3 L's - keep for 3 years
LAR - 3 Years
LE - 3 Years
Loan Compensation - 3 Years
The 5 BIG deals - Keep for 5 years
CD - 5 Years
SAR, CTR, CIP - 5 Years
AFBA - 5 Years
*****Just remember the 3 bold items EVERYTHING ELSE is 2 years"
118
Fraud for profit schemes
"Flipping Straw Buyer Churning
Equity Skimming Contract Kiting Builder Bailout Flopping
Short Sale Fraud"
119
FHA Deals with 4 main things
"Redlining
Reverse Redlining
Steering
Blockbusting"
120
What was FHA Previously known as?
Civil Rights Act of 1866 and/or Title 8 (VIII)
121
What year did the Civil RIghts Act become FHA?
1968
122
Bi-Monthly
24 times a year
123
Bi-Weekly
26 times a year
124
Weekly
52 Weeks
125
5 reasons under FCRA someone can receive a free credit report
"Adverse Action (Denial) Public Assistance Unemployed
Fraud Identity Theft (Errors)
****** TIP remember this sentence:
I am unemployed and on public assistance, I have had an adverse action due to errors and fraud on my credit report."
126
What items does your NMLS # go on?
"1003 (URLA) Promissory Note Mortgages
All DIsclosures Advertisements Trust Deeds"
127
Types of Rate Caps
"Initial CAP
Periodic CAP
Lifetime CAP (Ceiling)"
128
Items that Create a Qualified Mortgage?
"Qualified SAFE Mortgage - Rule of 3's Points and Fees can't exceed 3% ATR (Ability to Repay is 3 letters) Back End Ratio can't exceed 43%
Prepayment Penalty is limited to the first 3 years on a fixed rate QM ( 2% of the outstanding balance)
No Terms over 30 Years
No Toxic Features (3 Kinds) No Balloons, No Negative Amortization, No Interest Only Protects the lender with a SAFE Harbor"
129
4 Sections of RESPA to know
"6 (S) Mortgage Servicing & Abuses 8(K) Fee splitting/Kickbacks/Unearned Fees 9(T) Title (Treble Damages)
10 (E) Escrow
***TIP - SKTE (looks like Skate)"
130
FHA 203B
"FHA Fixed Rate Loan
| ****B is for BASIC loan"
131
FHA 203G
"203G - Good Neighbor Next Door Program
| ****G is for the GOOD people"
132
FHA 203K
"203K - Rehab Loan
| **** Remember that Rehabs cost thousands (K) or you need to rehab a Krack house"
133
FHA 234C
"234C - Condo
| ****C is for CONDO"
134
FHA 251
"251 - ARM Loans
| ***Area 51 is where they keep the alien ARMS)"
135
255 HECM
HECM (Home Equity Conversion Mortgage) Reverse Mortgage
136
FHA 245
"Graduated Payment Method
****Payments start so small that it starts as negative amortization then the payments gradually grow larger and the loan ends with positive amortization."
137
FHA 245A
Growing Equity Mortgage
138
Streamline Refinance
"No Appraisal, No Income, No Credit
| .55% UFMIP"
139
EEM
Energy Efficiency Mortgage
140
FHA 2-1 Buydown
Temporary interest rate buydown.
Example if the starting rate is 7% the first
years payments would be at 5 % (-2% of
start rate) the
2nd years payments would be 6 % (-1% of start rate) and
3rd till end of loan will be back to
original rate (7%).
141
What are the 8 items that create the Ability To Repay (ATR)
```
MICE DOES have the ATR
Monthly Mortgage
Income/Assets
Credit
Employment
Debt- To- Income (DTI)
Other Debt(child support/credit cards/Student loans)
Expenses (Monthly Taxes & Insurance)
Simultaneous Mortgage
```
142
Regulation H
Secure and Fair Enforcement Act AKA Title V (5) - SAFE ACT
143
HERA
Housing and Economic Recovery Act
144
Regulation Z
Truth In Lending Act - TILA (Credit, APR & Advertising)
145
Regulation C
Home Mortgage Disclosure Act - HMDA
146
Regulation B
Equal Credit Opportunity Act - ECOA
147
Regulation V
"Fair Credit Reporting Act - FCRA &
| Fair and Accurate Credit Transaction Act - FACTA"
148
Regulation O
Mortgage Assistance Relief Services - MARS
149
Regulation N
Mortgage Acts and Practices - MAP
150
Regulation P
Gramm Leach Bliley Act (GLBA)
151
Regulation X
Real Estate Settlement Procedures Act - RESPA
152
How long must public assistance continue if it were to be considered income?
3 years
153
Is public assistance grossed up?
Yes
154
How much is public assistance grossed up?
25%
155
How many months of deposits of child support must be verified?
6 months
156
Examples of public assistance
"Retirement Child Support Disability Pension
| Social Security Unemployment Alimony"
157
How long must seasonal unemployment be verified to be considered income?
2 years
158
Section of the 1003
"Section 1 - Borrower Information
Section 2 - Financial Information / Assets & Liabilities
Section 3 -Real Estate
Section 4 - Loan & Property Information
Section 5 - Declarations
Section 6 - Acknowledgements & Agreements
Section 7 - Military Service
Section 8 - Demographic Information
Section 9 - Loan Originator Information"
159
How can you ask about Marital Status?
Married Unmarried Separated
160
VOM
Verification of Mortgage
161
VOR
Verification of Rent
162
VOE
Verification of Employment
163
VOD
Verification of Deposit
164
Red Flag Rules
Section 114
165
Loan Flipping is also known as?
Equity Stripping
166
Blockbusting is also known as?
Panic Selling
167
What is the note also referred to as?
Promissory Note
168
What is the Hello Letter?
Your Initial Escrow
169
What does Per Diem mean?
Per Day
170
What is another term for Adverse Action?
Denial
171
The APR is also known as what term?
Effective Rate
172
What other 2 terms can the Interest rate be known as?
Note Rate or Nominal Rate
173
What are the 3 CRA's (Credit Reporting Agencies)
Transunion Equifax Experian
174
What are the 3 appraisal approaches?
Cost - to replace or build
Income - Income Property
Sales Comparison - 3 comps used in comparison
175
4 types of involuntary liens
Tax Lien
Mechanics Lien
Judgements
Attachments
176
What is a voluntary lien
a mortgage
177
What are the 5 C's of underwriting?
```
"Capacity (ATR based on income)
Capital (Cash/Reserves)
Credit (Report/Score)
Collateral (Property Value)
Character (Willingness to repay)"
```
178
What is the 4506 - C
"Request for Transcript of Tax Return
| **Tip - Previously known as the 4506 -T"
179
What is the IRS 8821
Tax Information Authorization
180
MDIA
Mortgage Disclosure Improvement Act - Also known as the 373 Rule
181
MARI
Mortgage Asset Research Institute
182
SFHA
Special Flood Hazard Area
183
CFPB
Consumer Financial Protection Bureau
184
FHFA
Federal Housing Finance Agency
185
Who took control of Fannie and Freddie in 2008?
FHFA
186
CSBS
Conference of State Bank Supervisors
187
LAR
Loan Application Register
188
SAR
Suspicious Activity Report
189
HVCC
Home Value Code of Conduct - Under Dodd Frank
190
MBS
Mortgage Backed Security
191
HLACSD
Home Loan Application Credit Score Disclosure
192
FFIEC
Federal Financial Institutions Examination Council
193
E-Sign Act
"The Electronic Signatures in Global & National Commerce Act
| (Dry Signature)"
194
Wet Signature
Signing in actual pen - in person
195
CTR
Currency Transaction Report
196
CRA
Community Reinvestment Act
197
NPI
Nonpublic Personal Information (GLBA)
198
CIP
Customer Identification Program (UNDER BSA)
199
PITI
Principal, Interest, Taxes, Insurance
200
USPAP
Uniform Standard of Professional Appraisal Practice
201
DVA
Dept of Veteran Affairs
202
CTC
Clear to Close
203
HECM
Home Equity Conversion Mortgage
204
TIP
Total Interest Percentage
205
EBR
Established Business Relationship
206
FinCEN
Financial Crimes Enforcement Network
207
UDAAP
Unfair, Deceptive, Abusive Acts or Practices
208
Is a Refinance an Open or Closed End Loan?
Closed End
209
Is a Reverse Mortgage an Open or Closed End loan?
Open End
210
Is a Mortgage an Open or Closed End Loan?
Closed End
211
What 7 item are NOT included in the APR?
"Acronym TENACTS Title Insurance Escrow
Notary Fee
Appraisal Credit
Report Termite
Inspection Seller
Credits"
212
What Fees are included in the APR?
"Acronym PODIUM Processing Fees Origination Fees Discount Points
Interest (pre-paid/per-diem) Underwriting Fees Mortgage Broker Fees"
213
4 purposes of the Dodd Frank Act
"Financial Stability End to big to fail
| Protect the taxpayer - no bailout Protect against abusive practices"
214
What are the Settlement Services?
```
Acronym - PAPER CLIP CAST
Preparation of Documents
Appraisals
Pest Inspections
Examination (Title examination)
Real Estate Services
Credit Report
Loan Origination Fee
Insurance (Title Insurance)
Processing Mortgage
Closing Settling Mortgage
Attorney Services
Surveys
Title Searches
```
215
What 2 item make the LE?
GFE (Good Faith Estimate) & Initial TIL
| Truth in Lending
216
What two items make the CD?
Final TIL (Truth in Lending) & HUD 1
217
Where to do you find the Rate Lock?
On the Loan Estimate
218
How Long is the Loan Estimate good for?
10 business days
219
Who is ultimately responsible for the delivery of the Loan Estimate to the borrower?
The Creditor
220
Who holds the Flood Maps?
FEMA
221
What are the 5 Flood Zones?
A, B, C, V or X
222
What are the high risk flood zones?
"A & V Insurance
| is mandatory"
223
What are the moderate risk flood zones?
B & X (Insurance is optional)
224
What are the low risk flood zones?
C & X (insurance is not required)
225
Who is flood insurance purchased from?
NFIP - National Flood Insurance Program
226
The Service Transfer Disclosure Statement is also known as what?
The Goodbye Letter
227
What are 2 other terms for Escrow?
Impound or Reserve Accounts
228
What is another word for Seller Concessions?
Seller Contributions
229
What is a POA?
"Power of Attorney
| **** Could also be known as Court Appointed Guardian or Attorney In Fact"
230
What are all the initial disclosures?
```
Acronym MWALLK (moonwalk)
Mortgage Servicing Disclosure (RESPA)
When your home is on the line (TILA)
AFBA (RESPA)
List of HUD Counselors (RESPA)
Loan Estimate (TILA)
Know before you owe handbook (RESPA)
```
231
Tell me all about FHA's 2-1 Buy Down Points (Temporary Points)
"NOT the same as Discount Points This program buys down the rate for only the first 2 years
1st year the interest rate will receive 2% off starting rate
2nd year the interest rate will receive 1% off starting rate
3rd + years will be the original rate"
232
Tell me all about Discount Points.
"Discount Points are calculated on the LOAN AMOUNT Discount
Points are calculated on the LOAN AMOUNT 1 Discount point = .25% off the interest rate.
Discount points are usually paid by the borrower. It can be paid for by seller or builder
Fixed discount points - lowers the interest rate the LIFE of the loan
The cost of the point is a CLOSING COST Discount Points are paid to the LENDER Discount Points ARE calculated into the APR"
233
Who states that if a creditor receives a payment they must post that payment the date it is received?
RESPA
234
In how many days must a creditor respond to a payoff notice?
7 Business Days
235
A creditor must disclose forced placed insurance at & days prior to billing?
30 & 45 days
236
"Appraisals can only change by what amount?
| Line, Net & Gross?"
"Line - 10%
Net - 15%
Gross - 25%"
237
A Loan Estimate must be delivered or mailed no later than days after a loan application is submitted?
3 Business Days
238
What Items have 0% Tolerance?
```
Acronym - TRAIL
Transfer Taxes (Real estate)
Report (credit)
Appraisal
Interest Rate
Loan Origination
```
239
What Items have 10% Tolerance?
Acronym - TAG
Title Insurance (on the lenders list)
Anything off from the lenders list
Government Recording Fees
240
What Items have NO Tolerance?
"Acronym - PITT
Per Diem Fees (Prepaid Mortgage Interest)
Insurance - Hazard
Title Insurance (NOT on the lenders list)
Termite Inspection"
241
If a tolerance is exceeded from the LE to the CD how long does the lender have to pay back the borrower?
60 Business Days
242
If a tolerance is exceeded from the LE to the CD how long does the lender have to grant a corrected CD?
60 Calendar Days
243
What is the penalty for obtaining personal information?
5 years and a 10k fine for individuals and 100k fine for institutions
244
What is the penalty for sending an unauthorized fax?
$500 /$1,500 (Treble) Knowingly/Willingly Sending the fax
245
What is the penalty for violating RESPA?
$10,000 and or 1 year in jail
246
What is the penalty for violating ECOA?
$10,000
247
What is the penalty for violating TILA?
"$5,000 Single $25,000 Reckless
| $1,000,000 Knowingly Violating TRID"
248
What is the penalty for violating the SAFE act?
$28,474 (2020) each time / $30,058 (2021) / $31,928 (2022) each time
249
What is the penalty for violating the DNC?
"$42,530 (2020) per call/ $43,792 (2021) per call"
250
What is the penalty for violating HMDA?
Calculated based on a penalty matrix, which considers good faith, previous violations, and financial resources
251
What is the penalty for violating FACTA?
$5,000 or 1 year or both
252
What is the penalty for violating FCRA?
$1,000
253
What is the 2022 Conforming Loan Limit?
$647,200
254
What is the 2022 Reverse Mortgage Limit?
$970,800
255
What is section VIII also known as?
HMDA Monitoring Section
256
What are the steps in a QWR? (Qualified Written Request)
"1 - lender acknowledge request by 5 business days
2 - seek to resolve the issue/concern within 30 days
3 - 15 day extension if needed in connection to notices of error submitted by the borrower"
257
Who was chartered by Congress in 1970 to support the U.S. housing finance system and to help ensure a reliable and affordable supply of mortgage funds across the country.
Freddie Mac (FHLMC)
258
Who was established in 1968 as part of the U.S Department of Housing and Urban Development (HUD) to promote affordable homeownership
Ginnie Mae (GNMA)
259
Fannie Mae (FNMA)
FHLMC
260
Federal National Mortgage Association
GNMA
261
HER
Housing Expense Ratio
262
TOR
Total Obligation Ratio
263
PITI
Principle, Interest, Taxes & Insurance
264
Monthly Housing Expense
PITI - Principle, Interest, Taxes & Insurance
265
A Natural Person is also known as?
An Individual
266
According to CTR - Financial Institution must report if cash transaction exceeds ?
$10,000
267
"According to SAR (suspicious activity report) MLO's must report if exceeds
?"
$5,000
268
Who are SAR's (suspicious activity report) Reported to?
FinCen (within the FBI)
269
What is KAMILAS?
```
-RESPA Disclosures
Know before you owe handbook
Affiliated Business Arrangement
Disclosure
Mortgage Servicing Disclosure Statement
Initial Escrow
List of 10 HUD Counselors
Annual Escrow
Service Transfer Statement
GFH/HUD (non-purchases)
```
270
What is BRAWLCCT?
TILA Disclosures
```
Balloon Notice
Right of Rescission
ARM Disclosure
When your home is on the line
Loan Estimate
CHARM Booklet
Closing Disclosure
Transfer of Mortgage Notice
```
271
What are the 4 Initial RESPA Disclosures?
```
Know before you owe handbook
AFBA - Affiliate Business Arrangement
Disclosure
Mortgage Servicing Disclosure Statement
List of 10 HUD Counselors
```
272
What are the 2 initial TILA disclosures?
When your home is on the line & The Loan Estimate.
273
When is the ARM Disclosure given?
60 days prior to a rate change that affects the payment.
274
What type of loans received a right of rescission?
a refinance, home improvement loan, HELOC, or second mortgage loan
275
What type of loans do NOT receive a right of rescission?
Purchases, 2nd Homes & Investment Property
276
When is the Initial Escrow Statement GIven?
At closing or within 45 days of closing
277
When is the Transfer of Mortgage Notice given?
Within 30 days of acquisition - On Primary Mortgages Only
278
How many pages is the Loan Estimate?
3 pages
279
Where do you find the partial payment policy?
On the Closing Disclosure
280
CHARM means what?
Consumer Handbook On Adjustable Rate Mortgages
281
What does HELOC mean?
Home Equity Line Of Credit
282
What is the Hello Letter?
The Initial Escrow
283
When do you need to give the AFBA?
"AFBA is an initial disclosure that is given within 3 business days or time of referral
- If there is more than 1% ownership in the affiliate company that you are referring."
284
Revised Loan Estimate is received at least days prior to consummation of the mortgage
4 Business
285
When it comes to outstanding debt balances the lender will use what payment if there is not one on the credit report?
5% of the outstanding balance
286
Lender will use of the outstanding balance on Student Loan on Conventional Fannie, Freddie and on FHA
"1% & .5% & .5%
| Lender will use 1% of the outstanding balance on Student Loan on Conventional Fannie and .5% Freddie and .5% on FHA"
287
If you have a loan with LESS than payments - it is not counted in the applicants debt structure
10
288
If you have a lease, you count the payments even if it is 1 payment toward the applicants debt structure
ALWAYS
289
What is another name for Regulation?
Rule or Law
290
"A borrower is entitled to a copy of the appraisal report at least
days before closing"
3 Business
291
after a complete application, lenders have days to notify a borrower of their right to receive a copy of any appraisal or valuation
3 Business
292
"If credit is denied based on the Appraisal The borrower has days to request a copy and the lender
has days deliver it."
90 & 30
293
A creditor must provide an answer on a credit application days after receipt of a completed application.
30 Business
294
An applicant can request a statement of reasons within days of receiving the original denial notice
60 Days
295
If taking an application face to face who dictates the collection of the HMDA data?
ECOA - the interviewer MUST specify the applicant's race, ethnicity and sex
296
According to the DNC - What are the hours a creditor can call a number on a call list?
8am-9pm in the receiver's time zone
297
How often must the DNC lists be updated?
Every 31 days
298
How long are the DNC records kept?
2 years
299
What are 3 other names for Closing?
Consummation or Doc Signing or Settlement
300
What is section 1 of the 1003?
Borrower information
301
What is section 2 of the 1003?
Financial information - Assets & Liabilities
302
What is section 3 of the 1003?
Real Estate
303
What is section 4 of the 1003?
Loan and Property Information
304
What is section 5 of the 1003?
Declarations
305
What is section 6 of the 1003?
Acknowledgments & Agreements
306
What is section 7 of the 1003?
Military Service
307
What is section 8 of the 1003?
Demographic Information
308
What is section 9 of the 1003?
Loan Originator Information
309
Who Enforces MARS?
Consumer Finance Protection Bureau - CFPB
310
Who Enforces ECOA?
Consumer Finance Protection Bureau - CFPB
311
Who Enforces TILA?
Consumer Finance Protection Bureau - CFPB
312
Who Enforces RESPA?
Consumer Finance Protection Bureau - CFPB
313
Who Previously Enforced RESPA?
HUD
314
Who Enforces TRID?
Consumer Finance Protection Bureau - CFPB
315
Who Enforces MAP?
Consumer Finance Protection Bureau - CFPB
316
Who Enforces HMDA?
Consumer Finance Protection Bureau - CFPB
317
Who Enforces FCRA?
Federal Trade Commission - FTC
318
Who Enforces FACTA?
Federal Trade Commission - FTC
319
Who Enforces GLBA?
Federal Trade Commission - FTC
320
Who Enforces E-Sign Act?
Federal Trade Commission - FTC
321
Who Enforces DNC?
Federal Trade Commission - FTC
322
Who Enforces SAFE Act?
CSBS, AARMR & CFPB
323
Who Enforces FHA?
HUD
324
Who Created the DNC?
FCC & FTC
325
Who Created TILA?
Federal Reserve Board
326
Who Created HMDA?
Federal Reserve Board
327
Who Created the Red Flag Rules?
FTC & FACTA
328
Who Created the CFPB?
Dodd Frank Act & Consumer Financial Protection Act
329
Who Created TRID?
CFPB
330
Who Created MAP
CFPB
331
Who Created RESPA?
HUD
332
Who Created FHA (Fair Housing Act)?
Civil Rights Act of 1866 ----Title VIII Civil RIghts Act of 1968
333
Who Created the SAFE Act?
HERA - Title V (5)
334
Who Created the US Patriot Act?
US Department of Treasury
335
Who Created the FINCEN
Secretary of the Treasury
336
In a transfer of title who is the Grantor?
The Grantor is the owner of the property transferring the title away.
337
In a transfer of title who is the Grantee?
They are the party receiving the title
338
In the promissory note who is the maker?
The party making the payment
339
In the promissory note who is the payee?
The party receiving the payment
340
Are mortgages Judicial or Nonjudicial?
They are Judicial
341
In a mortgage who is the Mortgagor?
The party that holds equitable title and/or the borrower
342
In a mortgage who is the Mortgagee?
The party that holds legal title and/or the Lender who holds the mortgage and the note
343
Does the Note include the APR?
No
344
Does the Note include the legal description of the property?
No
345
Does the note include balloon riders?
Yes
346
Does the Note include the index used?
Yes
347
Does the Note include prepayment penalties?
Yes
348
Does the Note include the interest rate?
yes
349
In Trust Deeds who is the Trustor?
The Borrower/Owner
350
In Trust Deeds who is the Trustee?
the 3rd party disinterested that holds legal title for lender benefit.
351
In Trust Deeds who is the Beneficiary?
The Lender that holds the deed of trust and the note.
352
In an Assignment of Mortgage who is the assignor?
Party transferring the rights
353
In an Assignment of Mortgage who is the Assignee?
Party receiving the Contractual rights
354
If a consumer is closing their escrow account, the servicer must send information to the borrower within how many days?
3 Business Days
355
If a borrower rescinds and there is money collected in an escrow account the lender has how many days to refund the borrower?
20 Calendar Days
356
"During the annual review of an escrow account the servicer finds a surplus of
$50.00 or more. How many days does the servicer have to refund the overage?"
30 Business Days
357
If a LE to CD tolerance is exceeded how many days does the lender have to refund the borrower?
60 Business Days
358
It an applicant makes an inquiry or completes an application to a company, the company can call this person for how long?
3 month - also considered a customer
359
A company that has an establish relationship with the consumer, how long can the company call this consumer?
18 months from the consumers last purchase or payment. - ONLY caveat to that is if the consumer asks not to be called.
360
A Yield Spread Premium used to be what?
Compensation for the Loan Officer for closing a loan above par.
361
What is a Yield Spread Premium currently?
A lender credit given to the borrower for choosing a interest rate above par.
362
When is a SAR due if the person is identifiable?
30 Calendar Days
363
When is a SAR due if the person is unidentifiable?
60 Calendar Days
364
What is another term for permanent financing?
Take out loan OR Stand-Alone Construction
365
A suit of quiet title can also be referred to as what?
Quiet Title Action
366
What is Restrictive convenance?
Deed Restrictions
367
In regards to the foreclosure process - when does the lender need to make contact with the borrower if they have missed a payment?
The lender must make LIVE contact within 36 days of the missed payment
368
In regards to the foreclosure process - when does the lender need to give workout options to the borrower?
With in 45 days
369
A creditor/lender may not start the judicial foreclosure process for at least how many days?
120 calendar days
370
Within how many days must a creditor/lender notify the borrower after a completed loan workout application of the decision?
30 days
371
When is the notice of default sent to the borrower?
Day 90 there is a breach letter or Notice of Default sent to the borrower from the lender explaining that they are in default and that legal action is possible.
372
What form initiates the foreclosure process?
Lis Pendens
373
What is the illegal process of processing a loan application modification and filing for foreclosure at the same time called?
Dual Tracking
374
When is a balloon notice given?
90 days prior to a balloon payment being due
375
How do you ask a borrower how many children they have legally?
How many dependents do you have?
376
What is another name for USDA loans?
Section 502
377
What is FACTA Section 112?
Fraud Alert/Freeze - Section 112
378
What is FACTA section 113?
Truncation - Section 113
379
What is FACTA section 114?
Red Flag Rules - Section 114
380
What is FACTA section 216
What is FACTA section 216
381
What groups are EXEMPT from FHA
Member only organizations
Private Clubs
Owner Occupied home with no more than 4 units
Single family homes rented or sold w/o a broker service
382
What are the 3 types of Discrimination?
"Overt Discrimination - Blatant/obvious Disparate Treatment - The way you treat someone
Disparate Impact - shown through statistical analysis"
383
What types of transactions do you get a right of recission?
"RRHHS
Refinance Reverse HELOC
Home Improvement Second Mortgage"
384
What is an encumbrance?
Encumbrances impact the transferability and/or use of subjected properties
385
What is Positive Amortization?
you are paying more than the amount owed so you will pay the loan off earlier then the term specified so you have positive equity.
386
What is Negative Amortization?
not paying enough interest so the remaining interest get applied to the balance
387
What is Fully Amortization?
is when the borrower is fully paying off the loan with the regular scheduled payments over a set amount of time.
388
What is partial Amortization?
a portion of the debt is paid with regular monthly payments; then, a "balloon payment"—a large lump sum—is made on the loan maturity date.
389
What is Non Amortization?
An interest-only loan is a loan where the borrower pays only the interest throughout the term of the loan, with the principal being left unchanged.
390
When is a CHARM booklet given?
When the borrower is considering an ARM loan
391
Where do you find the YSP?
On the LE & CD
