Mortgage Lending

Question 1

What tolerance applies to fees charged by a lender affiliate under RESPA?

Answer 1

Zero tolerance

Question 2

According to the SAFE act, a mortgage loan officer is someone who?

Answer 2

Takes the application and negotiates rates and terms with the member

Question 3

How many days does a lender have to provide an initial loan estimate after receipt of a TRID application?

Answer 3

3 general business days (Saturdays only included if lender is open for substantially all its business on Saturdays)

Question 4

When an escrow account is established as a condition of a mortgage loan, the CU must provide an Initial Escrow Account Statement:

Answer 4

At closing or within 45 calendar days of closing

Question 5

What 6 pieces of information constitute a TRID application?

Answer 5

Name, income, SSN, property address, estimated property value, and loan amount

Question 6

Which transactions require an appraisal according to NCUA Part 722?

Answer 6

Residential mortgage loans exceeding 400k

Question 7

Which transactions require an appraisal according to NCUA Part 722?

Answer 7

Residential mortgage loans exceeding 400k

Question 8

What information is provided in the Homeownership Counseling Notice?

Answer 8

A list of HUD approved housing counseling agencies serving the borrower’s area

Question 9

True or False: The Fair Housing Act prohibits Credit Scoring.

Answer 9

False

Question 10

How often and when must a lender who originated 15,000 closed end mortgages report its HMDA data?

Answer 10

Annually on March 1st of the following year

Question 11

True or False: The SAFE act requires a MLO to provide his NMLS # in his initial written communication with the borrower.

Answer 11

True

Question 12

Under the SCRA the interest rate on debts in existence at the time of being called to active duty must be reduced to?

Answer 12

6%

Question 13

What is meant by “Disparate outcome” in the context of fair lending laws?

Answer 13

Unintentional discrimination resulting in unequal treatment

Question 14

Under what circumstances can a borrower request cancellation of PMI?

Answer 14

Once the loan balance reaches 78% of the original property value

Question 15

Real Estate owned by a service member may not be foreclosed upon during their term of active duty service or for a period of _____ following their return from active duty.

Answer 15

12 months

Question 16

True or False? Under the Fair Housing Act credit unions may vary the terms of credit offered based on credit score.

Answer 16

True

Question 17

True or False? Correcting a mistake made in a Loan Estimate is a Valid Change in Circumstance.

Answer 17

False

Question 18

What is the maximum percentage of allowable fees for a High-Cost Mortgage loan?

Answer 18

5% of the total loan amount

Question 19

When must a mortgage servicer notify a borrower about the placement of force-placed insurance?

Answer 19

Within 15 days of determining that the borrower’s hazard insurance has lapsed or become insufficient.

Question 20

What is the HMDA final action date?

Answer 20

The date of consummation, settlement, or closing date

Question 21

What conditions must be met for Borrower requested cancellation of PMI?

Answer 21

Borrower is current, has good payment history, loan balance has reached 80% of the original property value, and property is free of any subordinate liens

Question 22

What is the maximum allowable time frame for a mortgage servicer to acknowledge receipt of a written notice of error from a borrower according to RESPA?

Answer 22

5 business days

Question 23

The loss mitigation procedures found in RESPA prohibit a CU from foreclosing until the borrower is at least ____ days past due.

Answer 23

120

Question 24

True or False: If the CU discovers a deficiency in an escrow account that is less than 1 month’s escrow payment, it is permitted to allow the deficiency to exist.

Answer 24

True

Question 25

What distinguishes a High Priced Mortgage Loan from other loans?

Answer 25

It has an APR that exceeds the Average Prime Offer Rate by a specified threshold

Question 26

How many days prior to closing must a Closing Disclosure be provided to a borrower?

Answer 26

3 business days (precise)

Question 27

What does a safe harbor provision provide for mortgage lenders?

Answer 27

A level of protection by establishing specific actions or practices that ensure compliance with certain legal requirements

Question 28

3 forms of discrimination recognized by the ECOA?

Answer 28

Overt Discrimination
Disparate treatment
Disparate impact

Question 29

3 forms of discrimination recognized by the ECOA?

Answer 29

Overt Discrimination
Disparate treatment
Disparate impact

Question 30

Name the 5 types of Mortgage products

Answer 30

Fixed Rate Mortgage
Adjustable Rate Mortgage (ARM)
Closed End Home Equity loan
Home Equity Line of Credit (HELOC)
Reverse Mortgage

Question 31

A Point is traditionally _% of the loan amount.

Answer 31

1%

Question 32

Escrow

Answer 32

Am account held by the CU to pay taxes and insurance on behalf of the borrower.

Question 33

RESPA

Answer 33

Real Estate Settlement Procedures Act

Question 34

PITI

Answer 34

Principal, Interest, Taxes, and Insurance

Question 35

ITP

Answer 35

Intent to Proceed

Question 36

What Regulation does the Home Mortgage Disclosure Act fall under?

Answer 36

Regulation C

Question 37

What Regulation does the Real Estate Settlement Procedures Act fall under?

Answer 37

Regulation X

Question 38

What are the 3 parts of the Lifecycle of a Mortgage loan?

Answer 38

1. Origination
2. Servicing
3. Default

Question 39

What are the 2 parts of the ARM interest rate?

Answer 39

Prevailing Index plus Margin

Question 40

Loan Amount/appraised value

Answer 40

Loan to Value (LTV)