COFI
Cost of funds index. an average of rates paid on checking and savings accounts by a regional sample of us banks. one of several indexes used to set interest rates for arms
APR
annual percentage rate. expresses the annual cost of borrowing as a percentage of teh loan amount. it factors the interst rate and fees associated with the loan.
capacity
the ability a borrower to repay. documented by tax returns, w2 forms, pay stubs, and bank statements.
impounds (escrow funds)
mortgage insurance amounts required upfront for most loans above 80% ltv. they include 3-6 months property taxes, and 2 months hazard insurance and 2 months mortgage insurance. included in closing costs
ECOA
equal credit opportunity act. overseen by consumer financial protection bureau (CFPB)
SAFE ACT
Established by the State bank of supervisors and the american asociation of residential mortgage regulators
Equal Credit Opportunities Act
Requires notice of adverse action to be given to an applicant.
LPMI
Lender Paid Mortgage Insurance. Insurance paid by the lender instead of the borrower. This is accomplished by the lender increasing the mortgage interest rate.
Loan servicing
the process of recieving payments, customer service, administering escrow, investor accounting, collections, and foreclosures.
property flipping fraud
purchasing, falsely appraising property for a higher value, then selling. requires collusion with an appraiser or falsified documentation that inflates the value of the home.
MLO Licensing Requirements
fingerprinting, credit report, criminal record, preslicense education, passing test by 75%
AARMR
American Association of residential mortgage regulators. an association of state agencies regulating the residential mortgage industry.
ECOA and marital status
ECOA allows inquiry about marital status to determine the applicants rights and remedies.
Standard components of a title commitment
agreement to issue policy.
schedule a: commitment date, policies to be issued, interest in the land, legal description.
schedule b:
requirements for issuance, exceptions.
concessions
financing concessions: help borrower offset some closing costs associtated with loan. My come from sellers or real estate agents.
Sale concessions: property or contract related concessions. carpet allowance, repair allowance.
The value of concessions are
loan originator fees
a fee charged to lenders to cover loan processing costs, often equl to 1 percent of the value of a loan
Graham leach bililey
disclosure on an annual basis of their policies for collectin and sharing nonpublic information. possibility for consumers to opt out of disclosures of their nonpublic information to nonaffiliated third parties.
cannot disclose account access info of cons
TILA
Truth in lending act. requiring APR, term, totcal costs to be disclosed on docs
FCRA
Fair credit reporting act. Reporting agencies use procedures which are fair and quitable regarding confidentiality, accuracy and relevancy of personal info.
GNMA
Government national mortgage association. the actual guarantee agency for federally guranteed morgages by VA, FHA, RHS, and PIH. Ginne Mae's mortgage backed securities are the only MBS that are guaranteed by the federal government.
PMI
Private mortgage insurance. required when LTV is greater than 80%. Annual premiums are .5%.
TILA purpose
requrieds disclosore of information
USDA rural development guaranteed program
provides gurantee on approved private lenders loans. offers programs for moderate income applicants with 0 down, no pmi, and 102 ltv
HOEPA
Home ownership protection act. Amendment to TILA. addresses deceptive practices. rules for these loans are contained in section 32 of reg z for high rate/high fee loans.
URLA
Uniform residential loan application. 1003.
time to improve credit score
6-9 months
RESPA
real estate settlement procedures act. prohibits kickbacks. requires lenders to provide gfe, and hud-1, or hud-1a,
FICO
fiar isaac corporation. credit score.
vom
verification of rent (mortgage) a form used ro verify retnal payments.
right of recission
a consumer has a right of rescission in any transaction in which security interst is given in the consumers primary residence(HELOC) except new construction.
FHA AUS
automated underwriting system. morgtgage score card
tax certificates
issue by taxing authorities to closing agent to verify taxes due are paid at clsoding. taxes are included in closing costs
fcra
fair credit reporting act. requries credit reporting agencies to be fair in reporting
back ratio
the dti ratio a lender will allow for piti and regular monthly debt.
What act requires GFE
RESPA
Fees telemarketers pay in order to recieve copties of do not call list
first 5 area codes are free. $58 after. 15, 962 for entire list annualy.
calculation for monthly income required for loan payment and current debt load
PITI plus monthly recurring debt, divided by the back ratio.
Which agency enforces FCRA
CFPB consumer financial protection bureau
Construction to permant loan
the conversion of a construction loan to a longer term tradition mortgage after construction has been completed.
VA guaranteed loan
VA guarantees the repayment of morgage loan, granted vets. Low or no down payment requried.
initial escrow statement
a statment that itemizes the estimated taxes, insurance premiums and other charges anticipeted to be paid from the escrow account durning the first 12 months of the loan. lender has 45 days from settlement to deliver it.
fhlmc
freddie mac. federal home loan mortgage corportation. mortgages offered under freddie mac are called conforming.
disclosure
information relevant to specific transactions as required by law
loan prospector
freddie macs automated underwriting system
prohibited by ecoa
dsicrimination b/c race, color, religion, national origin, sex, marital status or age, source of income, or made a complaint under ecoa.
calculate rental income
monthly income x .75
closing costs
money paid by borrower in connection wiht the closing of a mortgage loan
heloc
home equity line of credit
what reg requires right to a copy of appraisal?
ecoa
pih
public indian housing. like fha
NIV
no income verification loan.
how long after bankruptsy before new homeloan
conforming 4 years from discharge. fha and va 2 years from discharge
collateral
property pledged as security for a debt
hmda
home mortgage disclosure act. an act of law that requires lneders to upoload app data to identify discrimination
cfpb
consumer financial protection bureau. responsible for regulating the financial industry.
VA
department of vererans affairs. guarantees loans for vets.
dodd frank mlo presentation requiriements
loan with lowest interest rate. lowest total costs. loan with lowest rate without negative features. must show loans where apr cannot increase, can increase, and reverse mortgages, a reasonable number of loan options.
GFE contents
settlment charges including ysp
prime rate
best rate available to a lenders best customer.
fraud vs predatory lending
fraud is cheating institutions. predatory lending cheating consumers
fha
federal housing administration. a divisuion of hud. insures morgages.
urar
uniform residential appraisal report.
hud
housing and urban development.
prepayment
the payment of all or part of a mortgage before it is due.
nontraditional mortgage product
anything other than a 30 year fixed
service transfer statment
a statement issued when servicers transfers the servicing of a loan
hoepa
home ownership equity protection act. the law addresses certain deveptive and unfair lending.
hmda
home mortgage disclosure act. requires aplication data to be provided to federal reserve to identify discrimination.
covered account
a credit acount with defered payment.
settlement
finalizing all dealings.
llpa
loan level pricing adjustments. up front fee charged for mortgage loans with higher risk profiles to offset potential losses.
MIP
fha mortgage premium. upfront mip and monthly .
poc
Paid outside of closing. charges that were paid outside of closing.
mbs
mortgage backed security. investment instruments bundled and sold on wall street
entitlement
a right due an individual. used with VA loans
section 9 RESPA violation
requiring buyers to purchase title insurance from a particular company
HECM
home equity conversion mortgage. a section 255 FHA loan. Reverse mortgage.
GFE
an estimate of all costs associated with a mortgage. 10 days minimum good.
FHA 251 loans
ARM 1 year t-bill index. 1-4 units.
TILA regulations
regulations regarding advertisements offering credit.
cRA
community reinvestment act. Encourages depository institutions to meet credit needs of communitites in which they operate.
4 catagories of credit score
payment history. 35%.
available credit. 30 %
credit history. 10%
credit inquiry. 10%
Front end ratio. front end DTI
gross monthly income X .28. Compare the answer to the project house payment.
how long must a lender reatin hud1
5 years, unless loan is sold. then purchaser must retain for 5 years.
FBI fraud warning
it is illegal for aperson to make any false statement...
facta
fair and acurate credit transaction act. additions to the fair credit reporting act. help fight identity theft
deed in lieu
a deed given by a morgager to stisfy a debt
truth in lending disclosure
costs of loan
ltv
the loan amount divided by the value of the property
o/o
owner occupied
pledged asset
something of value pledged as collateral for a loan
service release premium
similar to ysp, but only available to direct lenders. srp not shown on hud-1. paid after closing when loans are sold on secondary market.
how did the financial insitutions reform recovery and enforcement act adjust the requirements of the home morgage disclosure act?
expanded coverage of hmda to include more insititutions.
required reporting data regarding applications for mortgages and home improvement loans.
required lenders to identify the race
noo
non owner occupied
glbA
graham leach bliley act. established privacy rules and how creditors handle nonpublic information.
entitlement of va program
a dollar amount tha can be used to buy a house.
when are active military personeel eligible for a va loan
have having served on a continuous active status for at least 90 days
ysp
yeild spread premium. an amount paid to a broker for bringing a morgage application to them.
VA max gurantee
50750 or 25%
respa
law governs lending practice and disclosure. GFE and HUD within 3 days of loan app
elements of a adverse action statemetn
reason for denial of credit. identity of persons or office from which statement may be obtained.
libor
london interbank offered rate. used as arm index
hazard insurance
insurance to provide compensation incase of property loss or damage.
fnma
fannie mae.GSE to increase access to mortgages.
term
the period of time between commencement date and termination date of a note. / contract.
api
annual percentage interest.
ecoa notice required at
application
ammortization
repayment of amortgage debt with equal payments.
va eligibility
active duty for 90 days or 181 days during peacetime
nmls
nationwide mortgage licensing system. the record for mortgage industry licensing.
Fannie mae stands for
fnma. federal national mortgage association
piti
principle, interest, taxes and insurance
gpm
graduated payment mortgage. payments start loaw and increase before leveling out. involves neg am
credit report info
7 years
documents used to determine collateral forunderwriter
appraisal, survey, title search, plat maps
points
one time one percent.
what does fair houseing act require of proeprty owners
non discrimination for sale or rental based on race, color, national origin, sex famly status or handicap
fha pmi must be in place
5 years
fee simple
the right dispose of property or pass it on to ones' heirs
waive right to rescind
provide lender with writen dated statement describing the emergency signed by all parties entitled to rescind.
respa affiliated business arrangement disclosure
a required disclosure when the consumer is referred to a business which the referring party has 1% or more interest . gives an estimate of the second providers charges, and informs the borrower they are not requried to use the reffered provider.
how is hazard insurance calsculated
amount x insurance factor divided by 12
ltv for conforming
owner occupied: 90, 95, 80. second home:95. investment property: 90
90
consideration
required element of all contracts by which a legal right or promiseis exchanged for the act or promise of another person.
under respa when does mol not have to mail disclosures
if credit app is denied proir to the 3 business day deadline
advice to help improve credit score
time, credit balances, no additional credit, on time payments
prohibited acts covered by hoepa
loan proceeds cannot be paid directly to the home improvement contractor.
selling a loan without disclosre to the purchaser could be liable for all claims and defenses.
refinancing one hoepa loan with antoher to the same borrower within the first 12 month
respa 's definition of things of value
any payment, andvnce, funds, loan , service, or other consideration.
farmers home administration
an agency within the department of agriculture that provides financing to farmers
HECM loan
home equity conversionmortgage. 62, principle, meet fha standards, no other leins, attend hud approved hecm counseling program.
survey
a property inspection that determines the proision of a tract of land
sub prime lending
lending to weakened credit borrowers
hud 1 closing statement
a form that shows all charges imposed on borrowers
yield
ratio of investment income to total mount invested over a period of time
bankruptcy
a person relieved of debts, after the surrender of all assets to a court appointed trustee. chapter 7 covers liquidation of businesses. chapter 11 covers reorg of buisinesses. chapter 12 covers farms. chapter 13 covers individuals.
pattern or practive of discrimination under ecoa
when evidence establishes discriminatory actions were the regular practice.
seasoning
a loan which several payments has been collected
the regulation which requires lenders to indentify race sex color
hmda home mortgage disclosure act...as adjusted by the financial insitutions reform recovery and enfrocement act.
documents used to determine capital
cash, bank statements, stock account statements
due on sale
a clause in a morgage stating that if the morgager sells then the morgagee can accelerate loan.
how long does an indivdiual have to bring a private law suit for a violation of respa section 6
3 eyars
respa section 10
section ten sets limits on the amounts a lender may require a borrower to put into an escrow
what is a fannie maes autamated underwriting system
desktop underwriter
builder bailout scheme
when a fuilder inflates the cost of ahome he is trying to sell. the lender loans on the actual value but believes the builder to have already been given the inflated amount as a down payment.
loans exempt from respa
business loans, vacant land, large tracts of land 25 acres or more, certain loan assumptions. construction only loans. governments
verification employment form
fnam 1005
firrea
financial insitutions reform, recovery, and enformcent act. created regulatory entities to oversee thrifts and created guidlines for qualified thrift lenders
BPO
broker price opinion. written opinion of value offered by a licensed real estate agent
collection
the servicing procedure followed to bring a delinquent mortgage
mortgagee clause
a clause that may be attached to an insurance policty stipulating that the lender will receive a portion of insurance proceeds suffient to satisfy the unpaid amount of a loan in the event of loss.
float
the period of time between the reipt of the borrowers funds and the remittance of those funds to investors
what are the 5 key elements of an ARM
...
title report
report consisting of a survey, a phusical inspection of the collateral, and a search of the records
what is the ecoa also known as
regulation b
what is resp aka
regulation x.
comparables
comps. other properties used to determine value
fha again
insures residential mortgages
what reg requires good faith
respa, reg x.
what is the failure to disclose liabilites
when a borrower conceals financial obligations.
what agency oversees FACTA
the CFPB consumer financial protection bureau
what is section 6 of respa
allows for qualified written requests regarding escrow accounts.
what are the tolerance limits on disclosures made on fge
10%
depreciation
loss of value due to all causes. physical deterioration, functional obsolescence and economic obsolescence.
basis point
one hundreth of one percent.
trust deed
a document where a specific financial interest in title to real property is transferred to a trustee, which holds the deed as security for a loan .
frca
fair credit reporting act. a law requiring lenders rejecting loan requests because of credit information to inform the borrower of the source of such information.
undisclosed kickbacks
two parties conspire to exchange cash outside of closing.
earnest money
a sum of money given to bind a sale of real estate.
5 key elements of arm
indiex, margin, adjustment period, rate caps, start rate
ecoa penalties
10,000. or 500000
what is an acceleration clause
a clause giving lender the poer to declare loan due
defeasance clause
a promise by lender to give the borrower all interest in a proeprty once the loan is paid in full
fha title 11 section 234c loans
used for condos, rate may be fixed or adjustable
4 c's of underwriting
collateral, capacity, character, capital
affordable housing programs
programs offered by communities that offer lower rates, have higher qualifying ratios, easier underwriting requirements
penalty for willingly giving false informaition under tila
5k fine or imprisonment for 1 year
buy sell agreement
an agreement between an interim and permanent lender for the sale of a mortgage to the the permant lender upon the completion of a building
certificate of reasonable value
Va's version of an appraisal
under fcra is written authorition to obtain a credit report required
if the infomration is being gathered for the purpeose of extending credit, a written authorization is not requried
under hmda regulations, is the applicant requried to provide the hmda info
no
short sale scheme
premeditated short sale. a straw buyer is used to buy a home with no intention of making payments. the perp offers to buy the house from the bank on short sale terms.
what sorts of documents are used to determine a borrowers character
credit repeorts, bankruptcy papers, letters of explanation
what is the loan called when it exceeds conforming limits
non conforming, and jumbo
discount point
an amount payable to buy down the rate
patriot act purpose
stop money laundering,
national association of mortage brokers
honest, professional conduct, honesty in ads, confidentiality, compliace with law, disclosure of financial interests.
mortgage fraud
material misrepresentation to deceive a lender
no requirement complete statement is requried by what act?
MDIA. morgage disclosre improvement act
once a complete loan app, how long does the mlo have to provide a gfe
3 biz days
what authority oversees and enforces the patrio act
deparment of homeland security
purpos of ecoa
make credit available with fairness
form used to collect hmda data
urla 1003
price fixing
when 2 or more entities agree to se tthe price of certain services
valuation
estimate of a properties price thorugh apprisal
conventional financing
mortgage financing which is not insured or gauranteed by a governmental agency
hecm loan mature
home equity conversion mortgage. borrower sells. last person passes away. last person oves away
under facta what must mlo do with credit reports not reatined in a customers file
must have policy for desctruction
alta
american land title association. the national trade association of the abstract and title insurance industry. created standards and forms used by title companies. every title policy is an alta policy
what bureau did dodd frank create
the cfpb. consumer fiancial protection bureau. and indpendent bureauwithin the federal reserve system
terms for rural development gurantee program
30 year, no down payment.
conversion option of an arm
allows borrower to convert arm into fixed.
legislation requires the credit score information disclosure
facta. fair and accurate credit transactions act
teaser rate
introductory rate to entice the borrower into the loand
conveyance
transfer of legal title
straw borrower
a person who may or may not exist
cert of occupancy
authorization of municiplaity allowing a newly built building to be occupied
treasury bill index
an index based on rate being paid for treasury bills
investor
any person who invests
cash back scheme
buyer and seller collude to to decieve the lender to the true sale price of the property. the seller gives the buyer cash back outside of closing
4 ways forclosure can end
pays of default amount
a thrid party buys the property at public auction.
lender takes ownership of the proeprty aka reo
hecm fees
origination fee. closing costs, upfront mortgage insurance. monthly orgage insurance
borrower can see hud1 settlement
1 day before settlement
critera for loan to be covered by hoepa
1. orignial mortgage must exceed treasury rate by more than 8 points.
2. second loan lien must exceed the reasury rate by ten points.
3. total fees and points payable by the consumer closing exceed the larger of 611 or 8% of the total loan amount.
dti
relationship between the borowers long term debt payments and the monthly income
fha title ii section 203 h loans
destoryed by naureal dissaster, red taged and have certificate from fema, delcared area a disaster area, 100% fiancning fixed or adjustable
delinquency
loan in which payment is overdue but not yet in default
section 32 loan
high cost loans which require additional disclosures
ecoa evidence of disparate impact
equal application of policy that results in an adverse impact on applicants from a protected group.
closing agent
a person or org that has a fiduciar responsibility to see that terms of contract are carried out.
when must an mlo privide the hud settlement cost booklet to loan applicant
3 biz days
application
fnma 1003, fhlmc 65 hud 92900, va 26/1802a
blockbusting
using race to induce panic selling
tenancy
holding of realestate under any kind of title.
subprime risk indicators
2 30 day delinquincies in the last 12 months.
judgement int he past 24 months
bankruspty last 5 years
high default probablity by 660 or below credit
dti 50% or greater
occupancy fraud
claims to be owner occupied
max net adjustment allowed on app
15%
community reinvestment act
depository insitutions meet credit needs of communitites
under mdia when are early disclosures condidered to have been delivered
when they are delivered to the consumer or when they are placed in the mail
fraud aler on credit file
mlo must take steps to confirm applicants identity
safegaurd rules of graham leach blilbey act
written policies to protect customer info
balloon morgage
when a loan balance is due before fully maortizes
notice of default
written notice to a borrower that a default has occurred and legal action may be taken
redlining violates what statutes
refusing to make loans in particular neighborhoods. violates ecoa and fha
urar f
uniform residential appraisal report form 1004
how long to file suit under respa section 6
3 years
vesting
name of borrowers and the manner they hold title
mortgagor
the borrower
par
price of 100% of face value
tcpa,
telephone consumer protection act. do not call list
what fees can be charged the consumer prior to recieving the TIL disclosure
only a fee for the actual cost of the credit report.
who do predatory lenders target
hoemowners with equity, credit problems, who need cash.
people in financail need
e
what is pmi underwritin
once loan is underwritten, pmi is underwritten
section 35 hpml of reg z tila
apr exceeds average prime offer rate by 1.5 percent for a 1st lien, or a 3.5 for a second lien.
what does fha require for downpayment and closing costs
3.5.
does borrower have a right to a copy of their appraisal
yes, ecoa gives that right. they can request a copy within 90 days of notice of adverse action
under ecoa, what time period must discrimination lawsuit be initiated
within 2 years
what are trigger points for section 32 loans under TILA
apr exceeds 8 points onf first. 10 on second. 8 points fees.
under respa 3 things required of lenders provide at time of application
special info booklet. gfe, morgage serviceng disclosure statement. must be mailed within 3 days of revieving app unless loan is denied, then they are not requried to be sent.
margin called spread
the amount lender adds to the index to determine the fully indexed rate.
what extent can a mlo inquire about age, marital status, source of income etc...
only to determine applicants legal capacity.
alienation clause
gives lender rights when property is sold or transfered.
index
a refularly published rate, indpenednt of the lending institution, that measures the cost of funds
nonconforming mortgage loan
a loan in which does not conform with fnmae or freddie mac
section 8 violation under respa
accepting an item of value outside of closing
employmentincome fraud
overstating income
what agency oversees tila
cfpb
equity skimming
using a straw borrower to sign a property over to a rea borrower by quit claim deed. buyer rents out property until forclosure takes place
junior liens
second mortgage, suboridinate financing
how can hecm payouts happen
lump sum, line of credit, term payments, tenure payments a combo of any of the above.
lien
a legal claim of a creditor to a property as security for a debt
how can rate caps be written
adjustment period cap precedes the lifetime cap. 2/6 means 2% increase per adjustment period, 6% over the life of the loan
dodd frank added 3 prohitions for mlo compensation
cannot be based on loan terms or conditions.
cannot come from both consumer and lender.
cannot be based on particular types of loans.
state requried licenisng requrienments
8 hours of ce each year
payment adjustment period
length of time between changes to arm
fha gifts
docmunet relationship, source and transfer
settlement services
mortgage industry
does va cahrge mi?
no
what legislation requires financial pricay act notice to be given
graham leach bliley act
deficiancy
the deifference between outstanding balance an proceeds from sale
where must employer send voe
verification of employment. directly to the lender
max ltv for fha loans
580 is 96.5
500 90%
complete application: BLAMES
borrower name
loan amount
address
monthly income
estimated value of property
social security
hvcc
home valuation code of conduct. rules outlining interactions between lenders and appraisers.
lifetime cap
themax amount a rate increase that can happen over the lifetime of an arm loan
tolerance apr under TILA
1/8th of one percent
when must money a customer has given be returned if the customer recinds
within 20 days
under ecoa, how long does a lender have to retain a copy of any submitted application for credit
25 months
what is a financial institution under graham leach bliley
any kind of financial compnay.
requirements for mortage insurance under fha
all loans are required to have morgage insurance. upfront premiums are a perenctage of the loan amount and added into the loan.
mip must remain for atleas 5 years and ltv must be 78% or less in order to drop mip
act requiing this statmentL you are not required to compled this agreement merely because you have recied these disclosures or signed a loan application
MDIA. mortgage disclosure improvement act
conforming loan
loan that conforms with fannie and freddie
if consumer is not made aware of their right to rescind
the recission period will lapse on the earliest of the folowing 3 events:
1. the expiration of 3 years after consummation of the transaction.
2. transfer of all consumers interest in the property.
3. sales of consumers interest in the property.
what tells consumer they have a right to fair representation of their credit history?
fcra. fair credit reporting act.
fannie mae
fnma. largest mortgage investor
commitment
an agreement, between a lender and borrower to loan money
hecm responsibilities
keep property insured. pay property taxes. keep property in good repair.
purchase contract
agreement to purchase
section 32 mortgages
high rate or high fee loans addressed and governend in section 32 of TILA
hpml
higher prices mortgage loans section 35 reg z aka tila.
average prime offer rate. a survey based estimate of aprs currently offered on prime morgage loans of comparagle type.
where will the appraisal independence rule be added
to TILA (reg z)
ecoa adverse action
a statement of reasons is due customer
initial borrower interest rate
the first payments rate
conventional loans
loans not insured by fha, va, or sub prime
net adjestments are calculated on URAR
adjustment divieded by original price
mortgage banker
a firm that conducts mortgage lending activitie from its own funds
COE
issude from department of vererans affairs that establishes vets eligibility for va loan
net worth
theasests minus liablities
what form does irs have to requrest transcript of a tax return
4505-t
urar
uniform residential appriasal report
under writer
evaluates whether or not to makea particular loan
servicer
party who services loan
portfolio loan program
special loan program offers special features that cant be offered in traditional conforming loans.
warranty deed
a deed in which the grantor warrants that good title is being conveyed.
copies of right to recind?
2 to each borrower.
appraisals are good for
days
fha ttile ii 203 k loans
rehab loans min 5k
nontraditional loan
any loan other than a 30 year fixed loan
joint tenancy
interest goes to surving tennatn
under fcra, what must mlo provide to applicant upon taking adverse action
a clear notice of their right to obtain disclsoure regarding the nature of the information used to make the decision by making written request within 60 days of notification.
what restrictions apply to higher priced mortgage loans under hpml section 35 of the reg z?
must takeinto account buyers ability to pay
must verify income and assets.
must verify the borrowers ability to pay using largest payment during first 7 years
prepayment penaliteis are only allowed for the first two years of the loan
must establish escrow
silent second mortgage
an unrecorded second lien.
watchdog federal agency
HUD
payment buydown
a third party pays part of the PITI so borrower has a smaller payment
how long does a borrower have to decide whetehr to sing the loan agreement after recieving the special section 32 disclosures for hoepa
3 biz days
what timeframes is the lender under when receiving a qualified written request?
servicing lender must notify borrower of reciept of the request within 20 biz days. the lender has 60 days to investigate the complaint and provide a response.
where can lawsuits for violations of RESPA section 6,8,9 be filed?
at any federal district court in the districtin which the property is located.
fair market value
arms length transaction between willing buyer and willing seller
what are fha title ii section 245a loans
gpm. graduated payment mortgages. loan has scheduled negative amortization.qualify at intitial monthly payment.
mortgagee
lender
ffiec
federal financial insittions examination council collects demographic data submitted by lenders under hmda
heloc fraud
multiple helocs on one asset.
ecoa is also known as
reg b
ALSO KNOWN AS REG B:
to promote the availability of credit to all creditworthy applicants without regard to
race,
color,
religion,
national origin,
sex,
marital status,
age
public assistance * exercised any right
* prohibits creditor practices that
dodd frank created
the office of fair lending and equal opportunity
eligibility for usda rural development gurantee
115% medium income max. reasonable credit histories.
years of employment
2 years
how long must a lender keep all collected data under hmda
5years
seller provided funds
transaction costs paid by the seller except the real estate agents fees.
respa aka
reg x
neg am
unpaid interest added to principle amount
max urar adjustment
25%
va loan funding fee
fee paid by borrower to help cover the costs of foreclosure. may be included into the loan.
2/1 buydown
This is a process used by lenders to help borrowers qualify for a loan. It can be used on almost any fixed rate loan. The borrower's loan payments for the first 24 months are subsidized. The 2-1 reeferes to the equivalent payment for an interest rate belo
time to bring respa 8 and 9 lawsuits
1 year
hoepa disclosures
1. A written notice stating the loan does not have to be completed even though the borrower has signed the loan application and received the disclosures.
2. That the borrower could lose the home and any money put into it if they fail to make payments.
3.
penatly for respa 8 violations
10k or one year in prison
what act requires a request for credit to be given within 30 dyas
ecoa
warehousing
borowing funds on a short term basis to fund loans until they are sold
shotgunning
taking out multiple loans for the same hoem simultaneously
tolerance for block 5 on gfe
ten percent
under facta, what must an mlo provide an applicant when obtaining a credit report on them
notice to home loan applicant, credit score disclosure.
personal information disclosure
tell where information is shared within the lending company and how to limit that sharing if desired
freddie mac
federal home loan mortgage corporation
mdia corrected disclosures
3rd day after delivery, closing can occur.
redislcosing gfe
changes greater than tolerance.
reg z is also
tila
max payment
gross monthly income x front ratio.
required monthly payment income
front ratio divided by monthly payment
qualified written request
a written inquiry regaring escrow account made under respa section 6
gfe block 3
required services lender selects. cannot change more than ten percent
respa section ten escrow accounts
each month the lender may require the borrower to pay 1/12th of the total of all disbursements payable during the year plus an amount necessary to pay for any shortage inthe account.
financial statements
profit and loss statments
fair houseing act restrictions
1. It is illegal to threaten, coerce, intimidate, or interfere with anyone exercising a fair housing right or assiting others who exercise that right.
2. Advertising shall follow the same guidlines regarding discrimination (which applies to single-family
federal privacy law title V of the graham leach bliley act
law imposing restrictions on the useof customers nonpublic personal information
to assure a given rate at settlement
borrowers must lock in rates by paying a fee when they apply for financing
subordination
the process of a creditor taking a lower priority position for collection of their debt
under the mdia, once early disclosure a re mailed how soon can a loan close
7 biz days
fha title ii 203 b loans
most widely used. fixed rate
easment
right to enjoyment of land held by another
under the fcra, can mlo give a copy of the credit report obtained
only when the credit info used for the credit decision differs fromt he info obtained in the credit report
when must mlo provide mortgage servicng transfer disclsoure to loan applicatn
at time of application
vor how long
2 years
under ecoa how long does a person have to request explanation of reasons they were denied credit
60 days
laws in place to regulate residential lenders
respa, hoepa, tial, ecoa, fair credit act
fannie mae recs from du
approve and eligible
approve and ineligble
refer and eligible
refer and inelgible
refer with caution
VOD
verification of deposit. FNMA form 1006, is asking to berify funds availability for down payment
different appraisal method
comparison, cost , income
what is covered by section 8 of respa
kickbacks and other fees that drive up the cost of products to consumers
financial modernization act aka
graham leach bliley act
can a borrower be penalized for making apayment to the old servicer
no, as long as they made a timely payment within 60 days of the loan transfer
when a new til
when the apr become inacurate. must be revieved no later than 3 days before consummation
What are the LTV percentages for standard/conventional ARM loans?
Owner occupied:
* 1 family - 90%
* 2 family - 90%
* 3 to 4 family - 80%
Second home: n/a
Investment: n/a
Non res perm alien: 75%
how might a depository insittuion be penalized for a poor cra community reinvestment act
denied requests to open new branches
reconveyance
the acto fo a lender giving the borrwer interest in the property upon loan fulfillment
What are the restrictions on HOEPA loans (Home Ownership and Equity Protection Act)
1. Balloon payments on loans with a term of less than 5 years. This does not apply to loans of less than 1 year if the loan is a bridge loan connected with the acquisition or construction of a dwelling intended to become the consumer's principal dwelling.
security doc
establishes real proeprty as collatoeal for a loan
under ecoa, once a person applies for aloan, how long until mlo provides written notification to the action that will be taken
within 30 days
hpa
homeowner protection act
A law passed by congress in 1999 which requires lenders to cancel private mortgage insurance once the LTV reaches 78% of the original property value.
One exception is with FHA loans, which require mortgage insurance to be in place
sercicing transfer statement
15 days before the effective date of the loan transfer.
two types of title insurance
owners policy, lenders policy
Under what circumstances ARE prepayment penalties allowed on a HOEPA loan (Home Ownership and Equity Protection Act)?
1. If the penalty can be exercised in the first 5 years.
2. If the source of prepayment funds is not a refinancing by the creditor or an affiliate.
3. If the consumer's total monthly debt at the loan's consummation does not exceed 50% of their total month
TILA trigger terms
down payment amount
any payment
number of payments
period of repayments
amount of finance charge
Required Disclosures
If any triggering term is used in a closed-end credit advertisement, then the following three disclosures must also be included in that a
TILA non trigger terms
No down payment
APR
Uniform State Test (UST)
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