Term
| A buyer earns $19.48/hr and works 40 hrs a week. The borrower has applied for a 20 yr mortgage of $98,000 at 6.625%. PMI will be $174per month. The borrower has a car payment of $307 and a revolving credit card balance of $350. What is this borrower’s debt ratio? |
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Definition
(USE CREDIT
19.48*40*52/12=3,376.53 (monthly income)
.625/.125=5 (# of 1/8ths)
(7.16+(5*.075))*98=$738.43 (monthly P&I)
(738.43+174+307+(350*.05))/3,376.53=36.6%DTI
DTI=36.6% |
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Term
| What does RESPA stand for? |
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Definition
| RESPA - Real Estate Settlement Procedures Act - Also known as regulation X |
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Term
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Definition
| RESPA - Real Estate Settlement Procedures Act |
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Term
| What are 4 of the main purposes of RESPA (Regulation X) |
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Definition
1. Disclosure of loan settlement costs
2. Eliminate referral fees/kickbacks
3. Limit amount collected for escrows
4. Provide the settlement cost information booklet |
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Term
| Which regulation and law requires us to provide the settlement cost information booklet? |
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Definition
| We are required under Regulation X (Real Estate Settlement Procedures Act)to provide the settlement cost information booklet. |
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Term
| Which law and regulation limits the amount we are allowed to collect for escrows? |
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Definition
| RESPA (Regulation X) limits the amount we are allowed to collect for escrows. |
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Term
| Which regulation pertains to the disclosure of loan settlement costs? What is the name of the law/act connected with this regulation. |
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Definition
| Regulation X pertains to the disclosure of settlement costs. Regulation X is also known as Real Estate Settlement Procedures Act (RESPA). |
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Term
| Which law/regulation was enacted to eliminate referral fees and kickbacks? |
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Definition
| One of the purposes of RESPA/Regulation X is to eliminate referral fees and kickbacks. |
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Term
| RESPA is applicable to ________, _______, _________ (types of properties). |
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Definition
| RESPA is applicable to 1-4 unit properties, condos, and manufactured homes if they are placed on a lot owned by the borrower. |
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Term
| Which types of properties does RESPA NOT apply to? |
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Definition
| RESPA does not apply to commercial properties, businesses, land over 25 acres, temporary financing, bridge loans. |
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Term
| Does RESPA apply to commercial properties, businesses, land over 25 acres, and temporary financing? |
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Definition
| RESPA does NOT apply to: commercial properties, temporary financing, businesses, or land over 25 acres. |
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Term
| Does RESPA apply to 1-4 family, condos, and manufactured homes (if placed on a lot)? |
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Definition
| RESPA is applicable to 1-4 unit properties, condos, and manufactured homes if they are placed on a lot. |
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Term
| When you see the following key words, which law/regulation should you think of?: loan disclosures, settlement, settlement statement/HUD1, servicing statement, Good Faith Estimate (GFE), 3 business days. |
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Definition
| The following key words should make you think of Regulation X/RESPA: Good Faith Estimate, HUD1, GFE, Settlement Statement, Loan Disclosures, Settlement, Servicing Statement, 3 business days |
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Term
| Describe the key difference between the GFE and the HUD1. |
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Definition
| The GFE is an estimate, while the HUD1 shows the actual closing costs. |
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Term
| How long before the closing can the borrower request to see the HUD1? |
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Definition
| The borrower can request to see the HUD1 one day before closing. |
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Term
| RESPA documents are required to be sent out within how many business days of the application? |
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Definition
| RESPA documents are required to be sent out within 3 business days of the application date. (unless turned down in that time) |
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Term
| Which regulation/law requires documents to be sent out within 3 business days of the application date? |
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Definition
| Regulation X/RESPA documents are required to be sent out within 3 business days of the application date. (unless the borrower is turned down during that time) |
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Term
| What does section 6 of RESPA/Regulation X pertain to? |
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Definition
| Section 6 of regulation X (RESPA) pertains to the servicing of the loan. |
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Term
| Which section of RESPA (Real Estate Settlement Procedures Act) pertains to the servicing? |
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Definition
| Section 6 of regulation X (Real Estate Settlement Procedures Act) pertains to servicing. |
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Term
| Under section 6 (servicing) of RESPA (Regulation X) a single incident incurs damages/penalties up to $______. |
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Definition
| Under section 6 (servicing) of RESPA (Regulation X) a single incident can incur damages/penalties up to $1,000. |
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Term
| A single incident under Section __ (servicing) of Reg X (RESPA) can incur penalties/damages of up to $1,000. |
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Definition
| A single incident under section 6 (servicing) of RESPA (Reg X) can incur damages/penalties of up to $1,000. |
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Term
| A class action under section __ (servicing) of RESPA (Real Estate Settlement Procedures Act) can incur damages/penalties of up to $500,000 or 1% net worth (whichever is less). |
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Definition
| A class action under Section 6 (pertains to servicing) of RESPA can incur penalties of up to $500,000 or 1% of the company's net worth (whichever is less) |
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Term
| Under section 6 (pertains to servicing) of regulation X (RESPA) a class action can incur penalties of up to $_______ or __% of the company's net worth (whichever is less). |
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Definition
| Under section 6 (pertains to servicing) of RESPA (Regulation X) a class action lawsuit can incur penalties of up to $500,000 or 1% of the company's net worth (whichever is less). |
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Term
| Which section of the Real Estate Settlement Procedures Act (Regulation X) pertains to kickbacks/referrals? |
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Definition
| Section 8 of regulation X pertains to kickbacks and referrals. |
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Term
| Section 8 of regulation X (RESPA) pertains to ______ and ______. |
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Definition
| Section 8 of RESPA (Reg X) pertains to kickbacks/referrals. |
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Term
| Section 8 of _________ pertains to kickbacks/referrals. |
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Definition
| Section 8 of Reg X (RESPA) pertains to kickbacks/referrals. |
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Term
| Violations of section 8 (kickbacks/referrals) of regulation X (RESPA) are punishable by $______ and/or __ yr/yrs in prison AND 3 times the _________________________________. |
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Definition
| Violations of section 8 (referrals/kickbacks) of regulation X are punishable by $10,000 and/or 1 year in prison AND 3 times the amount paid for the service to the borrower. |
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Term
| A violation of section 8 of RESPA is punishable by a $10,000 fine and/or 1 year in prison and 3 times the amount paid for the service to the borrower. Describe what a violation of section 8 of reg x is. |
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Definition
| Accepting and/or giving kickbacks or paying for referrals is a violation of section 8 of regulation X (RESPA) and is punishable by up to $10,000 and/or 1 year in prison and 3 times the amount paid for the service to the borrower. |
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Term
| Section _ of RESPA (reg X) pertains to kickbacks/referrals. |
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Definition
| Section 8 of Regulation X (Real Estate Settlement Procedures Act) pertains to kickbacks/referrals. |
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Term
| Section __ of regulation __ pertains to escrow (limits how much can be collected). |
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Definition
| Section 10 of Regulation X (RESPA) pertains to escrow. |
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Term
| Section 10 of Regulation X (RESPA) pertains to ________. |
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Definition
| Section 10 of RESPA (Regulation X) pertains to escrow. |
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Term
| The amount you can collect for escrow is regulated under Section __ of regulation __, which is also known as ___________________. |
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Definition
| The amount you can collect for escrow is regulated under section 10 of regulation X, which is also known as the Real Estate Settlement Procedures Act (RESPA). |
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Term
| What is the fee for each UNintentional violation of section 10 of RESPA and what is the maximum allowable penalty amount in a 12 month period? What does section 10 pertain to? |
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Definition
| Section 10 of Regulation X (RESPA) pertains to escrow and UNintentional violations are punishable by $50 each but cannot exceed $100,000 in a 12 month period. |
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Term
| What is the maximum allowable penalty for each intentional violation under section 10 of regulation X (RESPA)? What is the maximum amount of these charges per year? |
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Definition
| Under section 10 of regulation X (RESPA) each intentional violation is punishable by $100 and there is NO limit on the total charges per year. These violations are relating to escrow. |
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Term
| Section 10 of RESPA regulates escrow accounts. How much can be charged for each unintentional violation and each intentional violation of section 10 of Reg X (RESPA)? |
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Definition
| Under section 10 (escrows) of RESPA each unintentional violation comes with a $50 fine and each intentional violation comes with a $100 charge. There is a $100,000 max of UNINTENTIONAL violations per year. |
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Term
| What does ECOA stand for? |
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Definition
| ECOA - Equal Credit Opportunity Act is also known as Regulation B (remember B Equal) |
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Term
| Which law/act is Regulation B? |
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Definition
| Regulation B is ECOA. (B Equal) |
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Term
| Which regulation is ECOA? |
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Definition
| The Equal Credit Opportunity Act is regulation B (B Equal) |
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Term
| "B Equal" --> Law/Act and regulation? |
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Definition
| ECOA - Regulation B (remember B Equal) |
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Term
| What is the main purpose of Regulation B? |
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Definition
| The main purpose of Regulation B (ECOA) is to eliminate discriminatory treatment of credit applicants. |
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Term
| Which Law/Regulation was put in place to eliminate the discriminatory treatment of credit applicants? |
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Definition
| ECOA/Regulation B was put in place to eliminate the discriminatory treatment of credit applicants. (remember B Equal) |
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Term
| What is the main purpose of ECOA? |
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Definition
| The main purpose of ECOA (regulation B) is to eliminate the discriminatory treatment of credit applicants. (remember B Equal) |
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Term
| Regulation B applies to which types of transactions? |
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Definition
| Regulation B (ECOA) applies to all credit transactions. |
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Term
| ECOA applies to which types of transactions? |
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Definition
| ECOA (Regulation B) applies to all credit transactions. |
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Term
| Regulation __ was put in place to enforce the equal treatment (eliminate discrimination) of credit applicants in ALL CREDIT TRANSACTIONS. It is also known as ____. |
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Definition
| Regulation B (B Equal) was put in place to enforce the equal treatment (eliminate discrimination) of all credit applicants in all credit transactions and is also known as ECOA (Equal Credit Opportunity Act). |
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Term
| Which regulation ensures every person has the opportunity to apply and submit applications and what is the law called? |
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Definition
| Regulation B (B Equal) ensures that every person has the opportunity to apply and submit applications. This regulation is also known as ECOA. |
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Term
| Which law ensures every person has the opportunity to apply for loans or submit applications? |
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Definition
| ECOA (Equal Credit Opportunity Act) aka Regulation B (B Equal) ensures that every person has the opportunity to apply and submit applications for loans without discrimination. |
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Term
| Regulation __ ensures that every person can apply/submit applications for loans without discrimination. This regulation is also knows at _________. |
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Definition
| Regulation X ensures that every person can apply/submit applications for loans without facing discrimination. This regulation is also known as the Equal Credit Opportunity Act. (B Equal) |
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Term
| When a consumer alleges a violation (discrimination) under ECOA/Regulation B, they have __ years to bring civil action. |
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Definition
| A consumer has 2 years to bring civil action from the date they allege a discriminatory violation of ECOA/Reg B occurred. |
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Term
| How long does a consumer have to file civil action after an alleged violation of Regulation B (B Equal)? |
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Definition
| A consumer has 2 years to file civil action from the date they are alleging a violation of ECOA/Regulation B occurred. A violation of Regulation B would be discriminating based on the prohibited terms under ECOA. |
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Term
| The penalties for violations of ECOA (discrimination) include: |
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Definition
Liability for punitive damages:
Individual actions can be up to ten thousand dollars ($10,000)
Class Action lawsuits can be up to five hundred thousand dollars ($500,000) or one percent (1%) of the creditor’s net worth, whichever is less. |
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Term
| ____ regulates violations related to advertising, harassing calls, MARS, red flags under FACTA etc.; ____ regulates funding of terrorism; and _______regulates pretty much everything else. |
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Definition
| The FTC (Federal Trade Commission)regulates violations related to advertising, harassing calls, MARS, red flags rule (identity theft), etc.; FinCEN is put in place to stop the funding of terrorism; and the CFPB regulates pretty much everything else. |
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Term
| What entity is supposed to stop the funding of terrorism? |
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Definition
| FinCEN is supposed to regulate the funding of terrorism. |
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Term
| What entity regulates MARS? |
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Definition
| FTC oversees/regulates MARS. |
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Term
| What is the red flags rule related to and who regulates it? |
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Definition
| The FTC regulates the red flags rule, which relates to the prevention of identity theft. |
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Term
| What does MARS stand for and what is the purpose of the law? |
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Definition
| The Mortgage Assistance Relief Act (MARS) addresses the acts and practices of for-profit companies that offer to work on behalf of consumers to help them modify the terms of their loans or to avoid foreclosure. |
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Term
| Which law was enacted to address for-profit companies that offer to work on behalf of consumers to help them modify their loans or avoid foreclosure and which entity enforces/oversees this law? |
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Definition
| The FTC enforces/oversees MARS (Mortgage Assistance Relief Services), which regulates for-profit companies which offer borrowers assistance in avoiding foreclosure or obtaining a modification. |
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Term
| Under MARS when (if ever) can a fee be charged for a modification? Who oversees MARS? |
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Definition
| Under the Mortgage Assistance Relief Act (MARS) a fee can only be charged for a modification once the modification is complete. MARS is regulated by the FTC. |
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Term
| Is a licensed attorney prohibited by MARS from accepting fees for preparing or filing documents in bankruptcy, court, or administrative proceedings? |
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Definition
| Licensed Attorneys ARE allowed to accept fees for preparing/submitting documents in bankruptcy, court, or administrative proceedings. These fees are ok under MARS. |
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Term
| Which law is regulation B? |
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Definition
| Regulation B - ECOA (B Equal) |
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Term
| Which law is regulation C? |
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Definition
| Regulation C - HMDA (Home Mortgage Disclosure Act) (C you at HOME) |
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Term
| Which law is regulation X? |
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Definition
| Regulation X - RESPA (RESPEX) |
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Term
| Which law is regulation Z? |
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Definition
| Regulation Z - TILA (Today I Learned About Zebras!) |
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Term
| ECOA is which regulation? |
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Definition
| ECOA is regulation B, which relates to discrimination. |
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Term
| Which regulation is HMDA? |
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Definition
| HMDA is regulation C and was put in place to stop lenders from ‘Failing to lend' (redlining) to certain geographic areas or segments of the population. |
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Term
| ______ is FAILING to lend to certain geographic areas or segments of the population, whereas ___________ is refusing to lend to someone who qualifies based on a prohibited factor. |
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Definition
| HMDA was put in place to stop redlining, which is failing to lend to certain geographic locations or segments of the population. ECOA was put in place to stop a lender from refusing to lend to a qualified borrower based on prohibited factors. |
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Term
| HMDA was put in place to prevent lenders from _________ to lend to certain geographic areas or segments of the population, while ECOA was put in place to prevent lenders from ________to lend to someone based on prohibited factors. |
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Definition
| HMDA was put in place to prevent lenders from failing to lend to specific geographic locations or segments of the market while ECOA was put in place to prevent lenders from refusing to lend based on prohibited factors. |
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Term
| RESPA is which regulation? |
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Definition
| RESPA is regulation X. Regulation X has to do with service transfer notices, HUD-1, GFE, QWR (written dispute of payment application, credit reporting, or some other aspect of the servicing of the account.), disclosure of closing costs, escrows, kickbacks/referrals, ABA. |
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Term
| Which regulation is TILA? |
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Definition
| Regulation Z is TILA (Today I Learned about Zebras). Regulation Z (TILA) is part of the Federal Consumer Protection Act and lays out disclosure requirements, advertising requirements as well as rights of rescission and penalties for violation. |
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Term
| How long must you retain documents related to TILA/TCPA? |
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Definition
| You must retain documents related to TILA/TCPA for Two years (hard T sound for Tila and Two) |
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Term
| Which law and regulation covers rescission rights? |
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Definition
| TILA/Regulation Z covers rescission rights. |
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