RE Finance Unit 6: Financial Agencies & Lending Programs

Question 1

Closing Disclosure

Answer 1

A disclosure of actual residential loan costs given to the borrower three business days before loan consummation (signing the loan documents). Funding of the loan follows right afterwards.

Question 2

Community Reinvestment Act (CRA)

Answer 2

Provides that financial institutions meet the credit needs of all citizens of a community.

Question 3

Equal Credit Opportunity Act (ECOA)

Answer 3

Provides for the elimination of discrimination for age, sex, and race in finance.

Question 4

Farm Credit System (FCS)

Answer 4

A complete national banking system for financing the activities of farmers and ranchers.

Question 5

Farmer Mac

Answer 5

The Federal Agricultural Mortgage Corporation.

Question 6

Garn-St. Germain Bill

Answer 6

Authorized deregulation of banks and savings institutions.

Question 7

Home Mortgage Disclosure Act

Answer 7

Lenders must report borrower’s profiles to Federal Reserve.

Question 8

Housing Choice Voucher Program

Answer 8

Low-income borrowers receive subsidies for interest or rent if they are tenants.

Question 9

(HUD)

Answer 9

Department of Housing & Urban Development; regulates GHA and GNMA.

Question 10

Interstate Land Sales Full Disclosure Act

Answer 10

Establishes rules for the sale of vacant land.

Question 11

Loan Estimate

Answer 11

A disclosure of estimated loan costs given by a lender to a borrower(s) within three business days of receipt of an application for a home loan.

Question 12

Moratorium

Answer 12

A temporary suspension of payments due under a financing agreement in order to help a distressed borrower recover and avoid a default and foreclosure.

Question 13

Mortgage Revenue Bond

Answer 13

A type of industrial development bond that is offered by state and local governments through their housing financing agencies and is tax-exempt.

Question 14

Mortgage Servicing Disclosure Statement

Answer 14

Lender is required to notify borrower when their mortgage is sold.

Question 15

Open-End Mortgages

Answer 15

A loan providing for future advances.

Question 16

Proposition 13

Answer 16

A California referendum limiting the amount of annual property tax increases.

Question 17

Real Estate Settlement Procedures Act (RESPA)

Answer 17

An act calling for the revelation of all costs in anticipation of closing a real estate transaction.

Question 18

Redlining

Answer 18

The delineation by a lending institution of those areas of a community occupied by less-than-desirable borrowers; not allowed under the Community Reinvestment Act.

Question 19

Tax-Increment Financing

Answer 19

Loans arranged by state and local industrial development boards to stimulate community growth that will, in turn, generate increased tax revenues.

Question 20

Truth in Lending Act

Answer 20

Protects against inaccurate and unfair credit billing and credit card practices. It requires lenders to provide you with loan cost information so that you can comparison shop for certain types of loans.

Question 21

Regulation Z

Answer 21

Truth-in-lending provision that requires lenders to reveal the actual costs of borrowing.

Question 22

Urban Renewal

Answer 22

Programs under HUD designed to renovate substandard housing areas.

Question 23

USDA Rural Development Program

Answer 23

Funds housing and service projects in rural areas.

Question 24

Usury

Answer 24

Charging more than the legal limit on interest for a loan.