TILA - Closed End Credit

Question 1

Disclosure for closed end loans must be given

Answer 1

Before consummation, which is the point a consumer becomes contractually obligated to the credit transaction

Question 2

For loans secured by real property an application consists of

Answer 2

Name 
Income
SSN
Property address
Estimate of property value
Mortgage loan amount soght

Question 3

For mortgage loan (not revere mortgage) secured by consumer dwelling (RESPA) a loan estimate must be delivered or mailed to consumer no later than

Answer 3

7 business before the consummation of the transaction

Question 4

Reverse mortgages require what kind of early disclosure

Answer 4

Good faith estimate no later than the third business day after creditor receives the written application

Question 5

Early disclosures do not apply toc

Answer 5

Home equity lines nor to timeshare planes

Question 6

Creditor must provide corrected disclosures with all the changes terms if the APR changes

Answer 6

1/8 of a percent in a regular transaction

1/4 of a percent in a irregular transaction

Question 7

Corrected transactions are assumed to be received

Answer 7

3 days after mailing unless delivered in person

Question 8

All disclosures must contain the following sentence

Answer 8

You are not required to complete this agreement merely because you received these disclosures

Question 9

You Cannot impose a fee with any application for a transaction subject to respa and secured by consumer dwelling before

Answer 9

The consumer received the good faith estimate or the loan estimate. Fees for credit reports are exempt from this

Question 10

A business day is defined as

Answer 10

Any day except Sunday and a legal holiday

Question 11

Waiver of waiting period can occur for a bon a fire emergency if consumer provides

Answer 11

A written, dated, waiver that describes the boba fide personal emergency

Question 12

For variable rate mortgage secured by a dwelling and the term is more than one year certain disclosures must

Answer 12

be given before application

Question 13

If variable rate mortgage and the loan was received in the phone or broker

Answer 13

You have 3 business days to provide disclosure

Question 14

The creditor may delay the disclosures until the due date of the first payment for mail or telephone apps if

Answer 14

Certain information is made available in electronic form

Cash price
Apr and if it can increase

Question 15

If information on which a disclosure is based is unknown

Answer 15

The creditor must estimate the information and state the disclosure is an estimate

For demand obligations, disclosures must be based on an assumed maturity of a year

Question 16

Disclosures must be

Answer 16

In writing

Conspicuously segregated from all other disclosures

Disclosures may be provided in electronic form subject to consumer consent

Question 17

Variable rate disclosures must be given in a closed end transaction where the APR

Answer 17

May increase after consummation

Circumstances of when it may increase

Any limitation of the increase

The effect of an increase

Question 18

Finance charges include

Answer 18

Interest
Points
Closing agent charges
Premiums for insurance
Broker fees
Chargers for third party work

Question 19

For closed end transactions secured by real property other than time share, lender must disclose that

Answer 19

There is no guarantee the consumer can refinance the transaction to lower the interest rate or periodic payments

Question 20

Other disclosure requirements

Answer 20

Identify the creditor making the decision

Late payment charges that may be imposed states as the dollar amount or percentage of the payment

Other information may be found in the contract

Question 21

Disclosures must be given for what post consummation events

Answer 21

Refinancing with change in terms

Assumptions

Rate adjustments with corresponding change in payment amount

Discloures must be provided at least 60 days but not more than 120 days first payment is due

Question 22

Creditor must provide consumer with disclosures in connection with the initial rate adjustment at least

Answer 22

210 but not more than 250 days before payment at the adjusted level is due

Question 23

Right of revisions apply to transactions where a lien is taken on the consumer

Answer 23

Principal dwelling and the loan is not for purchase, acquisition, or initial construction ( residential mortgage transaction)

Question 24

Right of recession does not apply to a refinancing by the

Answer 24

Same creditor

Question 25

Anyone who has ownership interest in the dwelling has the right to rescind within

Answer 25

3 business days

Question 26

3 business days for right of recession starts after at least three of the following events

Answer 26

Consummation of the transaction Delivery of the material TIL Delivery of the right to rescind

Question 27

Notice of the right to rescind must

Answer 27

Be on seperate document Disclose the security interest being acquired Disclose the consumer has the right to rescind Explain the effects of rescission Disclose the date the decision period ends

Question 28

How many recession copies must be given to each consumer with ownership in the property

Answer 28

2 If notice provided electronics, the. Only 1 is required

Question 29

Until the recession ends the creditor may not

Answer 29

Disburse funds Perform any services Deliver any materials

Question 30

Effects of valid recession

Answer 30

Security becomes void Within 20 days creditor must return money Once the money is returned, then the consumer has to return property and money to the lender

Question 31

Failure to properly provide the right of recession affords the consumer an additional

Answer 31

3 years to rescind the transaction

Question 32

Advertising should

Answer 32

Must state specific terms offered by the bank If if states finance charge, it must state APR

Question 33

In a closed end consumer loan secured by real property, other than a reverse mortgage, the creditor must provide a

Answer 33

Loan estimate unless the mortgage broker provides one

Question 34

For a mortgage loan, the loan estimate must be delivered no later than the third business day after the creditor receives the

Answer 34

Consumer application

Question 35

The final disclosure on mortgage loans must reflect the actual terms of the transaction an be provided no later than

Answer 35

3 business days before consummation

Question 36

Any disclosure not provided to the consumer in person will be

Answer 36

Considered to be received by the consumer three business days after they are delivered or placed in the mail

Question 37

If disclosures become inaccurate before consummation

Answer 37

The creditor must permit the consumer to inspect the disclosure at least one business day immediately preceding consummation

Question 38

If any of the following become inaccurate, new disclosures and a new waiting period are required

Answer 38

Apr Loan product changes Prepayment penalty added

Question 39

If amounts paid by the consumer exceed the amounts disclosed in the estimated disclosures in an amount greater than the allowed tolerance, the creditor must refund the excess

Answer 39

In 60 days after consummation

Question 40

Creditors must provide a ________ Special information booklet to a consumer who applies for a consumer loan secured by real property

Answer 40

Respa. Note. The book Must be mailed or delivered in 3 business days unless loan is declined

Question 41

Must be give to the contact the time of application or before a non refundable fee is paid

Answer 41

CHARM book and s loan program disclosure for each ARM loan

Question 42

The loan program book must contain

Answer 42

Fact interest , payment, or terms may change How interest was calculated Consumer should ask about current margin and interest rate Historical example

Question 43

Requirements for High Cost Mortgage

Answer 43

Secured by principal dwelling Apr will exceed sports by 6.5% or 8.5% if the loan is less than 50k. Or 8.5% for a junior lien Total points and fees more than 5% of loan transactions of 20k or more 8% or more if loan transaction less than $20k

Question 44

Exceptions to high cost mortgages are

Answer 44

Reverse mortgages Intial construction of a dwelling Bridge loan less than 12 months

Question 45

For a high cost mortgage, disclosures must be provided at least

Answer 45

3 business days

Question 46

High cost mortgages must not contain the following provisions

Answer 46

Ballon payments Negative amortization An increase in rate after defaults prepayment penalty A due on demand clause (unless fraud or security of collateral is impacted)

Question 47

Creditor may not open a high cost plan for a consumer without taking in consideration of the following for ability to repay

Answer 47

Income Employment Assets Collateral Current obligations

Question 48

A certificate that the consumer has obtained credit counseling from a HUD certified counselor for

Answer 48

High cost mortgage

Question 49

Early high cost mortgage disclosures

Answer 49

Must be provided three days in advance Must have APR For closed end loans, the amount of the periodic payment and the amount of any ballon payment For variable rate loans, statement that increase may increase, the amount of the single maximum payment

Question 50

Creditors may not refinance any high cost mortgage within one year of having made the loan into another

Answer 50

Higher cost loan

Question 51

A creditor may not extend a high cost mortgage unless the creditor obtains a __________ from the consumer indicating the consumer has obtained credit counseling fromHUD certified counselor

Answer 51

Certificate

Question 52

Higher prices mortgage loans include

Answer 52

Closed end consumer transactions secur d by the consumer principal dwelling with an APR that exceeds the average prime offer rate

Question 53

A loan originator may not direct or steer a consumer to s transaction based on the fact

Answer 53

That the loan originator will receive greater compensation from the lender

Question 54

What is a covered transaction

Answer 54

A transaction with an APR that exceeds the average prime offer rate for a comparable transaction

Question 55

Qualified mortgage is a consumer loan secured by a dwelling that

Answer 55

Provides for regular periodic payments that are substantially equal Does not have a term that exceeds 30 years Had points and fees that do not exceed regulation limitations Loan underwritten taking into account a payment using the maximum interest rate that may apply the first five years Income was verified dti does not exceed 43 %

Question 56

Safe harbor loan is

Answer 56

Is not a higher priced loan secured by a dwelling, complies with the repayment ability requirements

Question 57

A presumption of compliance loan is a higher price loan that

Answer 57

Presumed to comply with the repayment requirments. The creditor did not make a reasonable good faith determination of ability to repay

Question 58

A loan cannot be qualified mortgage unless

Answer 58

The points and fees don't exceed a certain % of loan amount Can be purchased by the govt Can be insured by HUD Can be gursnttee by the va Have ballon payment does not exceed 30 years Subtanually equal payments over 30 years Interest rate does not increase

Question 59

Consumer may not have prepayment penalties unless

Answer 59

The penalty is permitted by law The APR cannot increase after consummation The loan is not a higher priced mortgage The loan is a qualified mortgage

Question 60

A prepayment Penalty may not apply after the three year period

Answer 60

Following consummation