RESPA Flashcards
- The Real Estate Settlement Procedures Act (RESPA) provides consumer protection for loans on ______________.
residential properties (1-4 units).
- Nothing of value can be given in _____________ with the exception of __________ that are allowed to exchange referrals between themselves.
exchange for the referral of business, real estate brokerage firms
- RESPA (Regulation X) is primarily involved with ________________.
the disclosure of closing costs and the prevention of kickbacks, which may raise the amount of closing costs to the consumer.
- The ______________ enforces the RESPA regulations. _____ was the previous enforcer.
Consumer Financial Protection Bureau, HUD
- RESPA does NOT apply to loans secured by __________.
commercial properties.
- RESPA does NOT apply to vacant land (UNLESS ___________________________).
A dwelling is intended to be constructed on the land within two years
- RESPA does NOT apply to properties containing ___ or more acres ( _______ property).
25, agricultural
- RESPA does not apply to temporary financing, such as _________________________.
bridge loans and construction loans.
- RESPA Section _______ deals with the mortgage servicer and mortgage servicing abuses.
6
- RESPA Section 6 deals with the __________________.
mortgage servicer and mortgage servicing abuses.
- A ___________ is the company that collects monthly mortgage payments, pays taxes, insurance, and other items as they come due, and notifies the borrower of late payments.
mortgage servicer
- Homeowners who are having issues with their mortgage servicers may take advantage of a provision of RESPA whereby a borrower may request information relating to the servicing of a loan. It is called a ____________________.
Qualified Written Request, or “QWR,” and imposes a duty to respond to borrowers’ inquiries.
What is a Qualified Written Request (QWR)?
Qualified Written Request (QWR) - Homeowners who are having issues with their mortgage servicers may take advantage of a provision of RESPA whereby a borrower may request information relating to the servicing of a loan. It is called a Qualified Written Request, or “QWR,” and imposes a duty to respond to borrowers’ inquiries.
- What section of RESPA mandates a creditor to provide a monthly statement to a consumer?
Section 6
What section of RESPA states that creditors must promptly post a payment the day it is received?
Section 6
- What Section of RESPA requires creditors to respond to a payoff request within seven (7) business days?
Section 6
- RESPA Section 6 requires creditors to respond to a payoff request within _____ business days.
seven (7)
- RESPA Section 6 requires creditors to make disclosure to the consumer ___ and ___ days prior to billing for force-placed insurance.
30 and 45
- RESPA Section 6 states that creditors must resolve written consumer complaints within ____ days of written receipt.
30-45
- RESPA Section 6 states that the lender must attempt to establish live contact with in ___ days with a borrower who has missed a mortgage payment
36
- RESPA Section 6 states that a creditor must provide a borrower with mortgage workout options (loan modification/forbearance options/short sale options, etc.) to the borrower within ___ days of a missed payment.
45
- RESPA Section 6 A creditor must notify a borrower within ___ days after submission of a complete loan workout application if there is an option to _______.
30, save the home.
- According to RESPA Section 6 a creditor may NOT seek judicial foreclosure or a trustee’s sale action for at least ___ days for a borrower who is delinquent.
120
- RESPA Section 6 prohibits __________, which is continuing to seek foreclosure actions while the borrower is being considered for other workout options.
dual tracking
- RESPA Section ___ prohibits kickbacks, fee splitting and unearned fees. Unearned fees are also known as advance fees or upfront fees.
8
- Illegal referral fees are known as ________.
Kickbacks
- RESPA Section 8 prohibits giving or accepting a _________ in exchange for the referral of _________.
“thing of value”, settlement services.
- Despite prohibiting kickbacks, RESPA does NOT prohibit payment of fair market value for ____________________________.
goods or services that were received or performed.
- A “thing of value” may include what?
gift cards, sports ticket, advertising space, marketing material bearing a real estate agent’s information to give to his/her client, etc.
What is the only exception to RESPA section 8 that can be given or accepted?
Promotional items (with company logo) are permitted
- RESPA Section 9 prohibits the seller from requiring the buyer to use a ___________, as a condition of the sale, unless the seller pays for the title insurance and all other title-related fees.
particular title company
- If RESPA Section 9 (prohibits the seller from requiring the buyer to use a particular title company, as a condition of the sale, unless the seller pays for the title insurance and all other title-related fees.) is violated, the seller could be sued for how much?
3x’s (treble damages) the amount paid for the service.
- RESPA Section 10 requires lenders to conduct an ____________ if the account has impounds (escrow account/reserve account).
annual escrow analysis
RESPA Section 10 requires lenders to conduct an annual escrow analysis if the account has ___________.
impounds (escrow account/reserve account).
What is the annual escrow analysis?
The annual escrow analysis summarizes the activity in the impound account
- RESPA Section 10 states that the lender can take no more than ______ of the annual amount of the property taxes and insurance premium for the purpose of the escrow account.
1/12th
- RESPA Section 10 states that to protect itself from escrow shortages, the lender may require a cushion that doesn’t exceed an amount equal to _________ of the total disbursements for the year.
1/6th (2 months)
- Overages of ____ or more discovered in a borrower’s escrow account during the annual audit analysis must be refunded to the borrower (if the borrower is not delinquent). The refund must be made within _______ days.
$50, 30 days.
- What are the RESPA disclosures?
KAMILAS: Know-Before-You-Own Booklet (Aka Home Loan Toolkit), AfBA, mortgage Servicing Documents, Initial Escrow, List of HUD Approved Counselors (10), Annual Escrow, Serving Transfer Statement (Goodbye Letter)
. (Note: the GFE/HUD are also RESPA disclosures – but only used with mobile homes, reverse mortgages, etc.).
- The lender must provide the borrower with a list of _____ HUD approved counselors.
ten (10)
- The Mortgage Servicing Disclosure is the standard form used to disclose to the borrower whether the lender intends to _____________________________________ This must be delivered to the borrower at or within _________
intends to retain the mortgage servicing of the loan (handling the monthly payments and paying the taxes and insurance obligations).
three days of the loan application.
- Initial Escrow Statement - Itemizes the ___________________________ “anticipated to be paid” from the Escrow Account during the loan’s first 12 months. Usually given at settlement, but lender has 45 days from settlement to deliver. Sometimes referred to as the “HELLO LETTER”.
estimated taxes, insurance premiums and escrow account charges