Quiz Flashcards
The truth in lending act does not include
Appraisal fees. Appraisal fees are not considered finance charges in a residential mortgage loan
The truth in lending act requires disclosure to an applicant of
Discount points to be paid to the lender. Discount points are a finance charge
The principal agent problem refers to
The relative lack of consequences for a lenders agent (mortgage broker or loan originator) in the mortgage transaction.
Which document advises the consumer not to provide false information in relation to his loan application
The HUD special information booklet
ECOA requires that
An applicant must be given notification of the status of his loan application within 30 days
According to TILA a variation up to what amount is permitted for the annual percentage rate in a regular fixed mortgage transaction
1/8%
If the lender determines at any time during the life of the loan that the property securing the loan is located in a special flood hazard area and is not covered by flood insurance, then
The lender may force place the insurance coverage if the borrower does not promptly purchase it
When must loan applicants receive an adverse action notice if they cannot qualify for a loan
Within 30 days of the loan application
The practice of directing a borrower toward a subprime loan when he could qualify for a more standard loan is called
Steering
Before providing then GFE, it will be assumed that the loan originator has collected what 6 items
Borrowers name SS # Gross monthly income Property address Estimate value of property Amount of mortgage loan sought
The section of the Uniform Residential Loan Application titled “information for government monitoring purposes”
Must nite the applicants sex, race and ethnicity, based on the lenders visual observation or the applicants surname if the applicant refuses to provide this information
Under the bank secrecy act, each institution must develop a written ______ compliance program, which must be approved by the institutions board of directors
Anti-money laundering
Form #1003 is the
Uniform Residential Loan Application Fannie Mae (1003) Freddie Mac (65)
The minimum number of comps needed for a residential mortgage appraisal is
3
A loan secured by vacant or unimproved property is covered under RESPA only if
The loan proceeds will be used to construct or place a structure or a manufactured home on the real property within 2 years from the date of the settlement of the loan. RESPA does not apply to the extension of credit primarily for business, commercial or agricultural purposes
Foreclosure is initiated on a consumers principle dwelling that secures a credit obligation. At this time, the finance charge and other disclosures affected by the finance charge are considered accurate if they are above the amount required to be disclosed or if they are understated by no more than
$35
Regulation Z requires that an ad stating the down payment for a closed-end mortgage must include
Terms of the repayment of the loan
A loan originator who prides a revised GFE must retain documentation for the reason he had to provide a new GFE for at least
3 years after the settlement
The ARM index based on the interest expenses on savings deposits reported by member savings banks in the federal home loan bank system’s 11th district is
The COFI
Cost Of Funds Index
The borrower is obtaining a loan to purchase a new home. Settlement is anticipated to occur 90 calendar days from the time the GFE is provided. The loan originator may provide the initial GFE with a disclosure that he may issue a revised GFE anytime up until
60 calendar days prior to closing
Examples of prohibitive misleading advertising include any comparison between any rate or payment that will be available for a period less than _______ ; and any actual or hypothetical rate or payment
The full length of the mortgage credit product
In a mortgage transaction subject to RESPA that is secured by the consumers dwelling, a TILA Disclosure must be delivered or mailed within 3 business days after receipt of a written application and no later than
The 7th business day before the transaction is consummated
Employment and income documentation is generally valid for no more than how many months prior to the date of the mortgage note
4 months
120 days
Within how many business days of receiving a mortgage loan application must a loan originator provide the applicant with the Special Information Booklet
3 business days
In order to discourage appraisal fraud caused by loan originator pressure, the Federal Housing Administration (FHA) discourages flipping by determining that a property resold within _____ days from the last sale is not eligible for FHA financing.
90 days
The statement “You are not required to complete this agreement merely because you have received these disclosures or signed a loan application”, is required by
Regulation Z on TILA disclosures and redisclosures
ECOA and Regulation B provide that, for qualifying purposes, a creditor cannot ask an applicant about
Race or sex
The primary purpose of the Truth In Lending Act (TILA) is to
Ensure consumers are given disclosures of credit terms
An originating lender may be required to return the SRP (service release premium)
If the borrower defaults within the first 3 months
A licensee who takes unreasonable advantage of a consumers lack of understanding of the material risk of a mortgage loan product would be guilty of
An abusive act or practice
Who determines if flood insurance is required for a particular property
The lender
A home builder advertises that it will finance the homes it builds. What additional information must be in the ad in order to comply with the TILA
Nothing
When a TIL Disclosure is mailed, the applicant is considered to have received it
3 business days after the mailing
Which of the most common types of fraud typically relates to loan documentation
Occupancy, employment and income misrepresentation
RESPA does not require lender disclosures of closing costs and procedures for what home loan
Temporary construction loans
TILA provides that the APR advertised for a mortgage loan can deviate form the actual rate being offered to customers by
0%
The practice of advertising and adjustable rate mortgage as a fixed rate mortgage is a violation that is termed
Bait and Switch
What is not required to be disclosed under the TILA
Title charges
In a loan transaction involving a mortgage broker, then
The lender is responsible for ascertaining whether the GFE has been provided. The GFE may be provided by either the lender or the mortgage broker
In regard to money laundering, the process of separating the criminal proceeds from their criminal origins using financial transactions in ine or more accounts is called
Layering
The TILA provides that a lender refinancing a residential property must give the borrower
A new TIL Disclosure for the new loan
An Alt-A loan
Is a loan made to a borrower with less than prime credit or lack of supporting documentation
What is true of a promissory mortgage note
It gives a lender a promise to repay the money borrowed with interest
A trigger term is the
Amount or percentage of any DOWN itiidositutkpypppprueuyyt
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