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NMLS Exam > Truth-In-Lending Act (TILA) - Reg Z > Flashcards

Truth-In-Lending Act (TILA) - Reg Z Flashcards

(63 cards)

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1
Q

What does TILA apply to?

A

1-4 unit single family dwellings; extensions of credit payable in 5+ payments, 1st/2nd party transaction

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2
Q

According to TILA, listing the numbers for what three things act as trigger terms in advertisements?

A
  • APR
  • Down Payment
  • Term of Repayment
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3
Q

According to TILA, stating what is not a trigger term in advertisements?

A
  • “APR”
  • “VA”
  • “LTV”
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4
Q

According to TILA, advertisements must be what?

A
  • clear & conspicuous

- equal prominence

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5
Q

According to TILA, how long must ads be kept on file for?

A

2 years

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6
Q

Under TILA, what is the MLO Compensation Rule?

A

The Dodd-Frank Title XIV Amendment to TILA to prevent steering by MLOs

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7
Q

What does the MLO Compensation Rule prevent?

A

steering by MLOs

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8
Q

Under TILA, The MLO Compensation Rule what can an MLO never be compensated on?

A
  • rate
  • term
  • program
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9
Q

Under TILA, The MLO Compensation Rule what can an MLO be compensated on?

A
  • volume
  • flat fee
  • long-term performance
  • pull through rate
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10
Q

Under TILA, The MLO Compensation Rule says you may only pay for files that close. (True or False)

A

True!

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11
Q

Under TILA, what does The MLO Compensation Rule say is the MAX company profit share?

A

10%

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12
Q

What does MDIA stand for?

A

Mortgage Disclosure Improvement Act

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13
Q

What is MDIA under?

A

TILA (or TRID)… Just say Reg Z to be safe?

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14
Q

What regulation is TILA?

A

Reg Z

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15
Q

What is MDIA?

A

3/7/3 Rules and Timelines

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16
Q

What are the AIR Laws?

A

The Appraiser Independent Requirements

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17
Q

AIR Laws say that Appraisers must follow what requirements?

A

Uniform Residential Appraisal Requirements (1004/70)

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18
Q

What does URAR stand for?

A

Uniform Residential Appraisal Requirements (1004/70)

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19
Q

What does URAR say?

A
  • appraisals good for 120 days (if longer than 442 Recert)

- compares other sold properties in the recent past

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20
Q

Can an MLO influence the value of appraisal directly or indirectly?

A

NO! Never!

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21
Q

What two things can an MLO pay an appraiser based on?

A

timeliness and quality

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22
Q

What can an MLO never pay an appraiser based on?

A

value

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23
Q

An MLO can only have limited communication with an appraiser. (True or False)

A

TRUE

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24
Q

What does USPAP stand for?

A

Uniforms Standards of Professional Appraisal Practice

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25
What is the USPAP?
Appraiser's "Rulebook"
26
Subject Property = ______.
BASE
27
What is the subject property/base used for?
To find comparables similar to base (not same price)
28
Tolerances: | Line = ____
10%
29
Tolerances: | Net = ____
15%
30
Tolerances: | Gross = ____
25%
31
Tolerances: | Land = ____
30%
32
For appraisals, when is the market/sales approach used?
existing properties
33
For appraisals, when is the cost approach used?
construction or unique properties
34
For appraisals, when is the income approach used?
commercial or rental properties
35
What was the 1994 Amendment to TILA?
HOEPA
36
What does HOEPA stand for?
Home Ownership Equity Protection Act
37
What is a HOPEA loan?
A High-Cost Loan (Section 32)
38
High-Cost Loans: | 1st lien:
APR +6.5% > APOR
39
High-Cost Loans: | 2nd lien:
APR +8.5% > APOR
40
High-Cost Loans: Points/Fees Cap: | Loan is greater than $21,000 = _________
5% cap
41
High-Cost Loans: Points/Fees Cap: | Loan is less than $21,000 = _________
lesser of 8% cap or $1,000
42
Under TILA, under HOEPA, what is Section 35?
HPML
43
What does HPML stand for?
Higher-Priced Mortgage Loan
44
Higher-Priced Mortgage Loan: | 1st lien:
APR +1.5% > APOR
45
Higher-Priced Mortgage Loan: | 2nd lien:
APR +3.5% > APOR
46
Higher-Priced Mortgage Loan: | Jumbo:
APR +2.5% > APOR
47
What are HOEPA/HPML prohibited loan terms?
- no balloons within first 5 years - no negative amortization - no prepayment penalties within first 2 years - no demand clauses
48
With HOEPA/HPMLs, what must be verified?
ATR... no "collateral-only" loans
49
What does ATR stand for?
Ability to Repay
50
A person is not allowed to go from HOEPA to HOEPA within ___ months.
12 months
51
If a person has a HOEPA/HPML, they must have an escrow account for how long?
At least 5 years
52
If HOEPA is a person's first ever loan, what must they have?
HUD Counceling
53
What must a person have a 2nd appraisal?
If value increases 10% or more within 6 months
54
What is the HOEPA/HPML late fee max?
4%
55
HOEPA/HPML have no fees for what?
- payoff statement | - loan modification
56
What does Dodd-Frank add onto?
TILA
57
What Regulation is Dodd-Frank
Reg Z
58
Under Dodd-Frank, what is Title X Consumer Protection Act?
created the CFPB and transferred rule-making authority and enforcement
59
Under Dodd-Frank, what is Title XIV?
Mortgage Reform and Anti-Predatory Lending Act
60
What did Title XIV amend?
TILA and RESPA
61
What are the six Qualified Mortgage features under The Mortgage Reform and Anti-Predatory Lending Act?
- total DTI cap: 43% - points/fees cap: 3% of loan amount - no interest-only loans - no terms greater than 30 years - no negative amortization - no "no-doc" loans
62
What does the Ability-to-Repay rule do?
- provides "safe harbor" | - presumed compliant if creditor uses QM
63
What is MLO Safe Harbor?
providing: - lowest rate - lowest rate without risky features - lowest total $ for fees/points

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