If she pays two discount points, what is the total cost of the points? A MLO is considered to have an affiliated business relationship with a title company to whom it refers business if it has an ownership interest of more than. Two of the major components of the Dodd-Frank Wall Street reform and Consumer Protection Act are, the Consumer financial Protection Act and the Mortgage Reform and Anti-Predatory Lending Act, An objective of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 is to, eliminate unfair practices relating to compensation paid to mortgage loan originators. Which of the following is considered a triggering event? Calculating the housing expense ratio by taking stable monthly income and multiplying the .31 is the ratio used to qualify for. Federal law prohibiting public and private racial discrimination in any property transaction in the U.S. An instrument that gives a creditor the right to sell collateral to satisfy a debt if the debtor fails to pay according to the terms of the agreement. Sporadic bonuses received from an employer, A loan application report is due by March 1st of each year as a result of the enactment of the, Regulation z applies to all residential loans. must be accompanied by the fixed time period. Combining two or more parcels of land into one larger parcel. Soon thereafter, she discovers that the borrower's actual intention is for the property to be a rental property. What requires the bank to follow up with Jane to Verify the validity of the request? An Applicant was refused credit due to insufficient income. According to the FCRA, which situtation does not entitle someone to a free copy o his credit report? Which of the following documents are not necessary or applicable to comply with ability to repay rules? According to the FCRA, which situation does not entitle someone to a free copy of his credit report? Is this permissible? He has already taken and passed the retired National Test Component, but never, Bill must take and pass the National Test with Uniform State Content. This is a form of voluntary Conveyance. This is because rate locks can only be offered for a limited amount of time. After the collection of statistical data, lenders are required to forward that information to the regulator by what date under the HMDA? When purchased, protect the lender in the event that the title company does not fully fund, The clause in the mortgage that makes the note due in full upon sale or transfer of a property is called a, Which statement about the Federal Reserve is FALSE, A loan that has an initial low interest rate that returns to normal on the first adjustment period has a, All of these features of a VA-guaranteed loan EXCEPT. Protection from interest rate volatility by locking the interest rate and other key provisions prior to construction What document does the Veterans Administration use to determine the property value for a mortgage loan? granting a mortgage loan based on the terms the consumer applied for. Which appraisal method is probably the most useful for this situation? What source of income CANNOT be used when qualifying a borrower for a loan? Which of the following is correct regarding third party processing companies? from the time the land was first registered to the time of closing. It stated that the rate lock must be “written” to officially lock the rate per the TRID. Which is NOT an index that is typically used for adjustable rate mortgages? Confers upon the owner the right to make the land productive. What type of mortgage is insured by a government agency? Which information is NOT required to be included on the CD? Deed language that clearly states the grantor's intention to transfer the real property, Deed given by borrower to lender to satisfy a debt, avoiding foreclosure. ... Rate locks for construction loans must be. TILA requires creditors to maintain records that they complied with the disclosure requirements for how many years? When completing a loan estimate, where should a licensed mortgage loan originator include an estimate of applicable property taxes and hazard insurances? An instrument held by a third party as security for the payment of a note. Charge to the borrower. obtaining multiple valuations and selecting the most reliable. Under ECOA, providing different terms of financing for a potential borrower who has poor credit scores due to a recent bankruptcy is considered: A mortgage servicer must wait _____ days before she is allowed to file for foreclosure or trustee's sale, if the borrower has not submitted an application for assistance. I cannot find where TRID says that the rate lock must be written. A borrower owns several rental properties free and clear of any mortgage payment, and does not claim the income from those properties on her tax returns. The 3/7/3 Rule is associated with which law? Also called a Trust Deed. Mortgage, note, or other document defines what constitutes default. Which of the following would not be part of an escrow account on a government-insured loan transaction? Rate Locks for Construction loans must be. Which of these is required to be licensed? An extended period of rescission of _________ is given to consumes who did not receive a Truth in Lending Statement prior to close. A borrower elects to lower his settlement costs by paying slightly higher interest rate. What is the loan-to- value ratio if the loan amount is $100,000 the appraised value is $125,000 and the sales price is $127,000, Sara's stable monthly income is $3,000. Guarantees residential loans for veterans, The type of survey done to show the builder where to dig the foundation, walks, and driveways is the, According to the SAFE Act, a mortgage loan originator employed by a federally insured depository institution. Any mortgage that has a lower lien position than another mortgage. XYZ Mortgage Company rejected his loan application of May 5. Anything of value, such as money, services, goods, or promises, given to induce another to enter into a contract. After construction is complete, the loan must be paid in full or refinanced into a mortgage. Also Called COFI, An increase in the cost of goods or services. An instrument held by a third party as security for the payment of a note. Rate locks for a traditional 30-year mortgage typically last 30 or 45 days, though some lenders will go up to 60 days. According to the FCRA, when must a credit agency give a consumer a free copy of his credit report? Other term lengths are available for certain loan types. Helen's application to purchase a duplex where she will live in one unit and rent the other. He qualifies for an 85% CLTV. He has been in the mortgage industry for about 6 months and holds no licenses. Which disclosure is not required by HOEPA? Section 32, which governs which high cost/high interest loans, is implemented by which federal legislation? Neo is most likely a(n), If a borrower does not have the required amount to pay closing fees, a mortgage loan originator may lawfully, lower the fee amount by forfeiting a portion of the broker's commission. If a borrower receives an application over a live videoconference, and the borrower chooses not to provide government monitoring information, what should the MLO do? Also called Rural Properties FHA Loan Program. A telemarketer can be fined how much for calling someone registered on the National Do Not Call Registry? A borrower has a___ - day grace period after servicing transfer, should a payment accidently go the former creditor, If a consumer feels they have been discriminated against based on their membership in a protected class under ECOA they can go to the ____ to file a comoplain, CFPB or appropriate state civil agency as directed. PMI applies to which of the following types of loan transactions? Talk to her manager and underwriter about what she's discovered, On the Loan Estimate, broker fees and lender fees must be, Under a one-time construction close that has taken more than 4 months to be completed, FNMA will require the borrower to, provide New information about income, credit and assets. See Private Mortgage Insurance. This appears on the Loan Estimate as. Which situation is least likely to be an example of predatory lending? Under the FCRA, consumers do not have the right to. The mortgage disclosure Improvement Act (MDIA) amends which federal Act? Mortgage servicing rules instituted by the CFPB provide additional consumer Protections related to. Sometimes called valuable consideration. A loan originator who does not include a borrower's receipt of long-term disability income on a loan application is. The refinance loan he's discussing with an MLO would bring his monthly payment down to $1,300. Which borrower may qualify for a reverse equity mortgage? Bob meets a loan origination at XYZ Mortgage Company to inquire about loan options. What's the highest his interest rate could be over the life of the loan? The Home Ownership and Equity protection Act. His current mortgage payment is $1600. What is the purpose of a closing protection letter? All of the following are included in an effective anti-money laundering program for financial institutions covered under the Bank Secrecy Act/Anti-Money Laundering Act except. When evaluating a Loan Estimate, each of these are subject to a 10% tolerance except. ECOA requires that a mortgage loan originator inquires about a customer's marital status in a specific way. Borrower must meet FHA qualifying standards and property cost can't exceed maximum FHA mortgage amounts. “Normal” rate locks are typically 30 to 60 days. See also Section 245 loans (FHA loan program), The first insurance premium paid for PMI. For which transactions must Danny follow the regulations of the Truth in Lending Act? If a lender transfers the servicing of a mortgage, it must inform the borrower at least how many days in advance of the effective date of transfer? What type of fraud is this? Borrower must meet all FHA qualifying standards and must spend at least, The interval at which a borrower actual interest rate changes with an ARM. Consistent with paragraph (b)(2)(i) of this section, the premium initial rate for purchases must be in at least 16-point type. My concern is not about the meat of the question, but about a comment regarding written rate lock agreements. Above 660 is an acceptable risk, 620-660 is a marginal risk, below 620 is a high risk. Which is NOT under the responsibility of and enforced by the Consumer Financial Protection Bureau (CFPB)? "higher priced" loans are defined by which law? Which regulation provides guidelines and restrictions on the process of renting, financing, and selling properties? She doesn't want ot list them on the 1003, as she doesn't have a payment. Under Regulation Z, which advertisement would trigger the requirements to disclose all finance charges and the true APR? See eminent domain, Any public notification of property being offered for sale, which must follow guidelines of Regulation Z of the Truth in Lending Act and all other applicable laws (Such as MAP Rules or Fair housing Act). Ike closes a loan with Max Mortgage. A borrower is buying a house for $150,000. before disclosing information to non-affiliated third parties. The opposite is a separate loan for each segment resulting in two transactions (purchase & refinance). Help. establishment of escrow account for payment of property taxes and mortgage insurance premiums, When evaluating rental income that is not reported on current tax returns, the lender will use a portion of gross rental income. XYZ. Credit history showing previous problems in meeting financial obligations. After the state regulatory authority revokes Lisa's mortgage loan originator license, does she have any option for appeal? from the initial APR on the preliminary Closing disclosure on an irregular loan, an additional waiting period is triggered. According to loan Originator compensation Rules, if any individual loan originator receives compensation from a consumer in a residential mortgage transaction secured by a dwelling , it is prohibited for the loan originator to, receive the compensation directly or indirectly from any third party service provider in connection with the transaction. The number of ARMs that may be insured by the FHA is limited to 10 percent of the total number of all Title II mortgages insured during the previous fiscal year. Clause that lets lenders demand full payment of a loan immediately. FHA mortgage insurance premiums must be paid for a minimum of 11 years for loans with starting LTV of 90% or less, When a seller owns a property that is to be resold during the first 90 days, a second appraisal is required for a conventional loan if the increase in price would be. Which monthly debt may not show up on a credit report? Sign up. A rate-lock agreement is a guarantee that the rate you’re given for your loan will stay the same until closing, regardless of market movement. The rule that bans providers of mortgage foreclosure rescue and loan modification services from collecting fees until homeowners have a written offer from their lender or servicer that they decide is acceptable is the. Certain product exclusions may apply. The rates below are effective February 26, 2021, for 45-day rate locks for single-family, owner-occupied purchases. Above 660 is an acceptable risk, 620-660 is a marginal risk, below 620 is a high risk. What source of income cannot be used when qualifying a borrower for a loan? Rates can be locked for 15, 30, 45, 60, 75, or 90 days. The income a borrower has left after subtracting taxes, housing expense, and all recurring debts and obligations (used for VA loan qualifying). A qualified Mortgage was first defined by which federal act? Any document that transfers title (Such as a deed), creates a lien (such as a mortgage), or gives a right to payment (such as a note or contract), failure to fulfill an obligation, duty, or promise, as when borrower fails to make payments, tenant fails to pay rent, or party fails to perform a contract. RESPA applies to to what type of properties? Help Center. b. Dodd-Frank Wall Street Reform and federal Act? Long Term. If a borrower inquires about interest rates or terms on a mortgage loan, what must they also receive? construction home equity loan. The parties to a mortgage are the mortgagor (borrower) and mortgagee (lender). Also referred to as AVMS, Deed Language that clearly states the grantor's intention to transfer the real property, Charges assessed to a borrower by a loan originator that serve little if any function and are often hidden in mortgage documents, Confers upon the owner the use land without undue interference from outside, Consideration paid by a tenant to a landlord in exchange for possession and use of property, Deeds executed by a trustee, executor, or other fiduciary, including conveying property the fiduciary doesn't own but is authorized to manage. Which Government agency monitors compliance with the ECOA. If she does not wish to provide information for that section of the application, what do you do? Which is derived from average interest rates, points, and other loan pricing terms offered to consumers by a representative sample of creditors engaged in mortgage transactions that have low risk? Page 1 of the LE includes the name & address of the creditor. Also called a Trust Deed. The Privacy Rule requires that financial institutions provide the consumer with a Consumer Privacy policy, before disclosing information to non-affiliated 3rd parties. Which law was passed primarily to discourage the practice of redlining? Compliance with which law requires the development of processes and procedures to ensure consumers information is kept private and secure? Which Federal legislation requires that the borrower have the right to receive a copy of his or her credit report, without charge annually, The clause in the mortgage that makes the note due in full upon sale or transfer of a property is called a(n), To comply with the FACT act, a mortgage loan originator should, place all loan applications and documentation in a secure place when not working on them, According to the SAFE act, a mortgage loan originator employed by a federally insured depository institution, When must a recertification of value be performed, Seven years is the maximum length of time adverse or negative information can be reported on a credit report according to the Fair Credit Reporting act, except for. A MLO's obligation is over when the loan is: Title insurance protects both a title and the process of the closing against risk of defects, forgeries, and errors that occur during what time period? The privacy rule requires that financial institutions provide the consumers with a consumer privacy policy. Which law includes prohibitions on steering incentives? Allow for a cash-out in a two-time close if the equity exists. Credit scoring where a number from 300-900 is assigned to a consumer's credit history. The rate lock fee may be a flat fee, a percentage of the total mortgage amount or added into the interest rate you lock in. The rates shown on advertisements are typically 30-day locks. The first loan will fund the physical construction of your home, and then you’ll need to apply for—and get approved for—a separate long-term loan on the completed home, to refinance the construction loan to a 15- or 30-year mortgage. If a mortgage broker closes a loan while his license is suspended or revoked, the loan is: Valid but the loan originator violated the law. How often is a creditor required to give an escrow statement which accounts for all funds received and disbursed as part of a mortgage loan transaction? Business and commercial loans, for example, are usually governed by contracts that must be agreed to and signed by all parties. A qualified Mortgage (QM) was first defined by which federal Act? Emily, a real estate agent tells Landon, MLO, in confidence that her seller had a second on the property to make the deal work out but that this seller does not intend to receive any payments. A mortgage loan originator must make the settlement charges detailed in a Loan Estimate available for how many business days? If there are multiple creditors: Use the name of the creditor completing the form. require bankruptcies be removed from their credit report after five years, if credit has been has been reestablished. gives borrowers with high-cost loans three business days to rescind the loan. Credit card and other revolving and open-ended credit accounts are also exempt from limits on the interest charged. Which is the type of loan where a seller may finance all or part of the sale of property for the buyer? Lenders must use the higher of either the fully indexed rate or introductory rate. The buyer's interest in property under a land contract. The loan requested divided by the total cost of the project is referred to as the: Which type of mortgage is most likely to cause payment shock? These mortgages have a stable interest rate for the life of the loan. An official whose primary function is to witness and certify the acknowledgment made by one signing a legal document. A loss in value due to hazardous waste being discovered nearby would fall under what category? If a lender transfers the servicing of a mortgage, it must inform the borrower at least how many days in advance of the effective date of transfer? The appraiser determines the home's value based on differences between the home and recent, Appraisal independence does not prohibit an appraiser from, Being paid a fee by a creditor based on what's customary for that area. A loan generally cannot be considered a qualified mortgage if the points and fees paid by the consumer exceed ____ percent (%) of the total loan amount, On the loan Estimate, broker fees and lender fees must be. Any influence that falls outside the actual property site and negatively affects a property's value. Joe has a property that appraises for $189000. Some lenders may lock your rate as part of issuing a Loan Estimate , but some may not. Loan originator compensation requirements is a set of amendments to which federal act? Rob cuts and Pastes the borrowers signature into the form and scans it to his email. The length of the rescission period for this mortgage loan is, three business days including Saturday, and excluding Sundays and holidays, RESPA requires at that the borrower, at what point, sign the loan estimate after the initial loan application, What are the terms of the "cooling off" period if a loan falls under HOEPA, What is the legal clause that gives the lender certain stated rights when there is a transfer of ownership in the property, when the broker borrower neither pays discount points nor receives a yield spread premium for the rate received from the creditor, According to the Truth in Lending Act, which of these would be excluded from the fiance charge. Which liability is EXEMPT from a debt ratio calculation? The borrower must meet all FHA qualifying standards and the property may include up to 2.5 acres of land but may only be 75% of maximum FHA mortgage amounts. Computer programs that are able to provide a probable value range for properties by performing a statistical analysis of available data. When a lender quotes an interest rate to a consumer, what must also be disclosed? Property value acceptable to the FHA as loan collateral is determined by the, lesser of the appraised value or purchase price, A recorded deed or recorded not and mortgage are considered to be a (n). B. Two-close construction loans, or multiple loans, require that you get approved for two separate loans. She is refused based on her race. Long term. When does a LO's obligation end in a construction loan? The Financial Services Modernization Act of 1999 is more commonly known as the. This appears on the Loan Estimate as. A lender has how many days to notify the borrower of the status of their loan? We currently offer 30, 45 and 60 day lock-in periods on our site. His name is on the National Do Not Call Registry. RESPA includes all of the following provisions except: One of the most critical points of the LO compensation rule is the prohibition of the practice of. What is the maximum length of time that collection information can be reported on a credit report according the the FCRA? This is a form of voluntary conveyance. a borrower wishes to sell a property that is part of a blanket mortgage, To transfer a right or interest to another is known as. This appears on the loan estimate as a. A loan generally cannot be considered a qualified mortgage (QM) if the points and fees paid by the consumer exceed_____ percent(%) of the total loan amount. If any triggering terms are used in an ad, which fact is exempt from the disclosure requirement? 2 of the major components of the Dodd-Frank Wall Street Reform & Consumer Protection Act are: The Consumer Financial Protection Act & the Mortgage Reform and Anti-Predatory Lending Act, the amount, in dollars, actually paid for the property, A seller takes back a $150,000 mortgage at 6% interest. A consumer calls to ask about a loan product. Like a mortgage, it creates a voluntary lien on real property to secure repayment of a debt. Under the Home Ownership and Equity Protection Act, a creditor may not refinance a Section 32 loan into another Section 32 loan within the first _________ of origination, unless the new loan is in the borrower's best interest. Which would not be considered a RESPA violation? If an MLO knows a borrower's income is not sufficient to qualify for a mortgage loan, it is acceptable to discourage the application to avoid denying the borrower. paying a part of the application fee to an appraiser, When conducting an examination, designated officers for the state regulatory authority have the authority to, The state regulatory may suspend a LO license if the licensee has, failed to remit his renewal fee by the annual deadline, A MLO is not required to provide a LE if the borrower, Withdraws the application within 3 business days. § 1026.57 Reporting and marketing rules for college student open-end credit. He has decided that he wants to leave his $53,000 first mortgage alone and only refinances the second. Which transaction for a single family home is not covered by RESPA? What is the name of a common USDA loan program? The lower the score, the greater the risk of default. Yes, she can appeal to the state Supreme Court. Which government entity will make loans when no other lender is available in an area? According to GLBA, which would not be considered NPPI and therefor is not protected? refer the borrower to an approved counselor. Which industry insider would be the one to most likely falsify a deed? Provide a best estimate based on visual observation and surname. The type of note that has an interest rate that varies up or down depending on the cost of money as determined by an index is called a: Charging interest rates in excess of the state maximum allowed is known as: All of these are features of a VA-guaranteed loan EXCEPT: Which of the following is NOT prohibited under the Federal Reserve LO compensation rule? Which law regulates the activities of consumer reporting agencies and users of consumer credit reports?

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