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Mortgage > RESPA COPY > Flashcards

RESPA COPY Flashcards

1
Q

The Real Estate Settlement Procedures Act (RESPA) provides consumer protection for loans on _____________________.

A

residential properties of 1-4 units

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2
Q

Nothing of value can be given in exchange for _________________.

A

the referral of business

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3
Q

RESPA is also known as ________________.

A

Regulation X

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4
Q

The __________________ enforces the RESPA regulations. _____ was the previous enforcer.

A

Consumer Financial Protection Bureau (CFPB) / HUD

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5
Q

RESPA (Regulation X) is primarily involved with the disclosure of _______________ and the prevention of ___________, which may raise the amount of closing costs to the consumer.

A

closing costs / kickbacks

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6
Q

RESPA does not apply to loans secured by ___________ properties.

A

commercial

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7
Q

RESPA does not apply to vacant land unless a dwelling is intended to be constructed on the land within ______.

A

2 years

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8
Q

RESPA does not apply to properties containing __ or more acres (also known as __________ property).

A

25 / agricultural

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9
Q

RESPA does not apply to temporary financing, such as ______ loans and ____________ loans.

A

bridge / construction

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10
Q

RESPA Section 6 deals with the ____________ and _______________ abuses.

A

mortgage servicer / mortgage servicing

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11
Q

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.

A

mortgage servicer

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12
Q

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. This is called a _________________, or ____, and imposes a duty to respond to borrowers’ inquiries.

A

Qualified Written Request / QWR

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13
Q

A Qualified Written Request (QWR) requires that the lender acknowledge receipt of the request within _________________ and seek to resolve the issue/concern within ______ (with a ______ extension if needed) in connection to notices of error submitted by the borrower.

A

5 business days / 30 days / 15 day

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14
Q

RESPA Section 6 mandates a creditor to provide a ____________ to a consumer.

A

monthly statement

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15
Q

RESPA Section 6 states that creditors must promptly post a payment _______________.

A

the day it is received

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16
Q

RESPA Section 6 requires creditors to respond to a payoff request within ______________.

A

7 business days

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17
Q

RESPA Section 6 requires creditors to make disclosure to the consumer ___ and ___ days prior to billing for force-placed insurance.

A

30 / 45

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18
Q

RESPA Section 6 states that creditors must resolve written consumer complaints within ________ of written receipt.

A

30-45 days

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19
Q

RESPA Section 6 states that the lender must attempt to establish _________ within ______ with a borrower who has missed a mortgage payment.

A

live contact / 36 days

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20
Q

RESPA Section 6 states that a creditor must notify a borrower within ______ after submission of a complete loan workout application if there is an option to ______________.

A

30 days / save the home

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21
Q

According to RESPA Section 6 a creditor may not seek judicial foreclosure or a trustee’s sale action for at least ________ for a borrower who is delinquent.

A

120 days

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22
Q

RESPA Section 6 prohibits _________, which is continuing to seek foreclosure actions while the borrower is being considered for other workout options.

A

dual tracking

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23
Q

RESPA Section 8 prohibits ________, __________ and __________.

A

kickbacks / fee splitting / unearned fees

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24
Q

Illegal referral fees are known as _________.

A

kickbacks

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25
Q

RESPA Section 8 prohibits giving or accepting a ____________ in exchange for the referral of settlement services.

A

“thing of value”

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26
Q

Despite prohibiting kickbacks, RESPA does NOT prohibit payment of ____________ for goods or services that were actually received or performed.

A

fair market value

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27
Q

RESPA Section 9 prohibits the seller from requiring the buyer to use a particular __________, as a condition of the sale.

A

title company

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28
Q

If RESPA Section 9 is violated, the seller could be sued for ____ the amount paid for the service. Also referred to as ___________.

A

3x / treble damages

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29
Q

RESPA Section 10 requires lenders to conduct an _______________ if the account has impounds (escrow account/reserve account).

A

annual escrow analysis

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30
Q

The annual escrow analysis summarizes the __________________________.

A

activity in the impound account

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31
Q

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.

A

1/12th

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32
Q

RESPA Section 10 states that in order 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.

A

1/6th (2 months)

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33
Q

Overages of ____ or more discovered in a borrower’s escrow account during the annual audit analysis must be refunded to the borrower (as long as the borrower is not delinquent). The refund must be made within ______.

A

$50 / 30 days

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34
Q

What are the 7 RESPA Disclosures?

A
  1. Know-Before-You-Owe Booklet (Home Loan Toolkit)
  2. Mortgage Servicing Disclosure Statement
  3. List of HUD Counselors
  4. AfBA Disclosure Form
  5. Initial Escrow Statement
  6. Annual Escrow Statement
  7. Servicing Transfer Statement.

(Note: the GFE/HUD are also RESPA disclosures – but only used with mobile homes, reverse mortgages, etc.).

35
Q

The lender must provide the borrower with a list of 10 __________________.

A

HUD approved counselors

36
Q

The Mortgage Servicing Disclosure statement _____ the same document as the Mortgage Servicing Transfer Statement.

A

is not

37
Q

The Mortgage Servicing Disclosure is the standard form used to disclose to the borrower whether the lender intends to ______________________ of the loan. This must be delivered to the borrower at or within ______ of the loan application.

A

retain the mortgage servicing / 3 days

38
Q

The Initial Escrow Statement itemizes the estimated ________, _____________ and _________________ “anticipated to be paid” from the Escrow Account during the loan’s first 12 months.

A

taxes / insurance premiums / escrow account charges

39
Q

The _________________ is sometimes referred to as the Hello Letter.

A

Initial Escrow Statement

40
Q

This ______________ is often referred to as a Goodbye Letter in the industry.

A

Servicing Transfer Disclosure

41
Q

RESPA states that a _________________ is required if the loan servicer sells or assigns the servicing rights to a borrower’s loan to another loan servicer.

A

Servicing Transfer Statement

42
Q

The ________________ is required to be provided to the borrower by the servicer no later than ______ BEFORE the servicing rights are transferred to the new servicer.

A

Servicing Transfer Disclosure / 15 days

43
Q

According to the servicing transfer disclosure, there is a statutory ______ “grace period” during which any payment mistakenly made to the old servicer must be forwarded to the new servicer, and no late fee can be assessed.

A

60 day

44
Q

Per RESPA, a complete application consists of the following 6 items:

A
  1. Subject property ADDRESS
  2. LOAN AMMOUNT
  3. Borrowers monthly INCOME
  4. ESTIMATED VALUE AMMOUNT
  5. Borrower NAME
  6. SSN
45
Q

Per RESPA – if a borrower has submitted a complete application, the initial disclosures are “triggered” and must be provided to the borrower within ___________.

A

3 business days

46
Q

If the application is withdrawn within the first _____ or the lender denied the application within the first _____, the initial disclosures are NOT required.

A

3 days / 3 days

47
Q

The Home Loan Toolkit (Know Before You Owe booklet) is intended to help persons borrowing money to finance residential real estate better understand _________________________.

A

the nature and cost of real estate settlement services

48
Q

The The Home Loan Toolkit (Know Before You Owe booklet) is for ____________ only.

A

purchases

49
Q

A referring party must give the ____________________ Disclosure to the consumer (immediately) at the time of referral, or prior to loan consummation – if referring business where he/she has more than 1% interest in the referring business/service.

A

Affiliated Business Arrangement

50
Q

The GFE and HUD are _____ disclosures, however the Loan Estimate and Closing Disclosure are ______ disclosures.

A

RESPA / TILA

51
Q

The ______________ must be delivered 3 business days before loan consummation (doc signing) and a final ________________ must be delivered at the loan consummation (doc signing).

A

Closing Disclosure / Closing Disclosure

52
Q

RESPA requires two disclosures that must be given at settlement: The ______________, and the ________________, which may be given within 45 days of closing.

A

Closing Disclosure / Initial Escrow Statement

53
Q

___________________ occurs if the lender chooses the hazard insurance company when the borrower allows his policy to lapse.

A

Force-placed insurance

54
Q

The ________________ combines the initial TILA disclosure and the GFE.

A

TRID Loan Estimate (LE)

55
Q

The ________________ combines the final TILA disclosure and the HUD.

A

TRID Closing Disclosure (CD)

56
Q

The Loan Estimate must be delivered or mailed no later than _____________ after a loan application is submitted.

A

3 business days

57
Q

The terms on the loan estimate must be available for ____________.

A

10 business days

58
Q

When it is necessary to provide a revised Loan Estimate, it must be provided within ____________ of receiving information sufficient to establish a valid change in circumstance. Documentation must be retained regarding the reason for the revision for __________.

A

3 business days / 3 years

59
Q

The creditor must make sure that the revised Loan Estimate is received at least _________ prior to consummation of the mortgage loan.

A

4 business days

*remember, the soonest that a loan can close is 7 days – so 3 days + 4 days = 7 days

60
Q

If the creditor places the revised loan estimate in the mail as a method of delivery, the creditor must mail the disclosure ___________ prior to consummation of the loan, to allow for the 3 business day receipt rule.

A

7 business days

61
Q

A “valid changed circumstance” is defined under RESPA as:

A
  1. An Act of God, war, disaster or other emergency
  2. New information regarding the consumer, the loan or the property
  3. Information regarding the consumer’s qualification for the loan on which the originator relied in providing the LE that changes or is later found to be inaccurate
62
Q

The following are NOT considered “valid changed circumstance” as defined under RESPA:

A
  1. Errors in disclosing an initial or subsequent LE
  2. Delays in underwriting/checking in conditions, leading to locked extension fees
63
Q

Changes in the ___, __________ or the addition of a ______________ trigger a revised Closing Disclosure and an additional 3 business day waiting period.

A

APR / loan product / prepayment penalty

64
Q

When a consumer requests the cancellation of their escrow account, the lender must deliver an ______________ no later than _____________ before closure.

A

Escrow Closing Notice / 3 business days

65
Q

Lenders must retain the Closing Disclosure and related documents for ______ after closing.

A

5 years

66
Q

Lender must retain the Loan Estimate for _______ after closing.

A

3 years

67
Q

The ________________ must be provided by the creditor prior to canceling an escrow account for any consumer who had one established by the creditor.

A

Escrow Closing Notice

68
Q

Lender must retain the Escrow Cancellation Notice for _______ after loan consummation.

A

2 years

69
Q

A ____________________ is found on the closing disclosure regarding the acceptance of partial mortgage payments by the loan services. The disclosure informs the consumer about the policy and the acceptance of payment less than the full amount due under the note.

A

partial payment policy disclosure

70
Q

Lender must retain the Partial Payment Policy for ______ after loan consummation.

A

2 years

71
Q

What items have a 10% tolerance between the Loan Estimate and the Closing Disclosure?

A

Fees that the lender chooses or identifies, such as government recording fees or title insurance.

72
Q

What items have a NO tolerance limit between the Loan Estimate and the Closing Disclosure?

A

Fees for services that the owners choose for themselves, such as:

  1. Hazard insurance
  2. Title insurance (if the homeowners don’t choose one of the lender-identified selections)
  3. Fees that are paid per diem (pre-paid mortgage interest)
73
Q

The lender has _________ after the closing to refund to the borrower any portion of the charges that exceeded the acceptable amount of a stated tolerance level.

A

60 business days

74
Q

___________________ and ____________ trigger a new Closing Disclosure that must be delivered within 60 calendar days following loan consumption.

A

Non-numeric clerical errors / tolerance violations

75
Q

Closing costs greater than Loan Estimate are considered to be __________________.

A

not made in good faith

76
Q

Closing costs less than Loan Estimate are considered to be ____________.

A

in good faith

77
Q

TRID rules do not apply to _______, ___________ and mortgages for _____________________.

A

HELOCS / reverse mortgages / mobile homes not secured by real estate

78
Q

The Rate Lock information is ONLY found on the ________________.

A

Loan Estimate form

79
Q

Although mortgage brokers may provide the loan estimate to the borrower, the _________ is ultimately responsible for the delivery.

A

creditor

80
Q

As it relates to the Loan Estimate, a business day is any day in which the creditor is ____________________________. (Note this difference from the definition of a business day for the Closing Disclosure)

A

open to the public for the purpose of conducting regular business activities

81
Q

No fee (with the exception of a bona fide and reasonable credit report fee) may be received by the MLO or creditor until the borrower has ____________________.

A

received the Loan Estimate

82
Q

The penalty for violating RESPA is _________ and/or up to ___________.

A

$10,000 / 1 year in jail

83
Q

The main purpose of RESPA is to help consumers become ___________________.

A

better shoppers for settlement services

84
Q

What does RESPA consider settlement services?

A
  1. title searches
  2. title examinations
  3. title insurance
  4. attorney services
  5. preparation of documents
  6. surveys
  7. credit reports
  8. appraisals
  9. pest inspections
  10. real estate services
  11. loan origination
  12. processing mortgages
  13. closing or settling mortgages

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