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59 Cards in this Set
- Front
- Back
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RESPA
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Real estate settlement and procedures act (1974)
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What regulation is RESPA issued under?
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Regulation X
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Who is responsible for overseeing and enforcing RESPA?
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Consumer Financial Protection Bureau (CFPB)
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RESPA applies to -
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Federally regulated mortgage loans that are secured by a first or subordinated lien on a residential property
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Examples of loans exempt from RESPA:
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-loans on property 25 acres or more
-business purpose loans; commercial and agricultural -construction loans, bridge loans -vacant land |
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What are the disclosures that are required by RESPA?
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-GFE
-HUD1, HUD1A -Settlement Cost Booklet -Affiliated Business Arrangement -Homeownership counseling Organizations list disclosure |
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Good Faith Estimate (GFE)
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Initial disclosure of estimated settlement costs of mortgage loan. Not provided until property is identified
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Good Faith Estimate (GFE)
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Initial disclosure of estimated settlement costs of mortgage loan. Not provided until property is identified
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When would a GFE have to be re-disclosed?
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Required for any change in circumstances, such as credit quality or value of home
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When must a GFE re-disclosure be provided?
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within 3 business days of lender becoming aware of change.
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When must the GFE be provided to the borrower?
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no later than 3 business days after receipt of a loan app
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When must a GFE re-disclosure be provided?
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within 3 business days of lender becoming aware of change.
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When must the GFE be provided to the borrower?
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no later than 3 business days after receipt of a loan app
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Charges that may NOT change at settlement
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-origination charge
-charges or credit for interest rate lock, once rate is locked -adjusted origination charge -transfer taxes |
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When must a GFE re-disclosure be provided?
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within 3 business days of lender becoming aware of change.
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When must the GFE be provided to the borrower?
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no later than 3 business days after receipt of a loan app
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Charges that may NOT change at settlement
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-origination charge
-charges or credit for interest rate lock, once rate is locked -adjusted origination charge -transfer taxes |
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Charges may increase up to 10% at settlement
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-title services and lenders title insurance
-lender required settlement services -owners title insurance -government recording charges |
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When must a GFE re-disclosure be provided?
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within 3 business days of lender becoming aware of change.
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When must the GFE be provided to the borrower?
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no later than 3 business days after receipt of a loan app
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Charges that may NOT change at settlement
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-origination charge
-charges or credit for interest rate lock, once rate is locked -adjusted origination charge -transfer taxes |
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Charges may increase up to 10% at settlement
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-title services and lenders title insurance selected by lender
-lender required settlement services -owners title insurance selected by lender -government recording charges |
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Charges may change at settlement
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-title services when a borrower selects service provider not identified by lender
-title insurance when borrower selects not identified by lender -daily interest -homeowners insurance |
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What is the Hud-1 and Hud-1A?
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settlement statements that clearly show all the final charges with the settlement of the loan
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HUD-1 is used for _________ transactions?
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Purchase
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HUD-1 is used for _________ transactions?
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Purchase
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HUD-1A is used for ___________ transactions?
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Refinance
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When must the HUD-1/1A be provided to the customer?
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At closing, or 1 day prior if borrower requests it.
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If borrower or his agent is unable to attend closing, how will hud-1 be disclosed?
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must be mailed to borrower as soon as possible
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Settlement cost booklet is also known as:
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"Shopping for your home loan"
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Settlement cost booklet is also known as:
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"Shopping for your home loan"
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When must the Settlement cost booklet be given to a home buyer?
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3 business days of a mortgage loan application for purchase transaction
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Settlement cost booklet must be distributed as what?
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A separate and distinct document
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What is the purpose of the settlement cost booklet?
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Explains settlement process and advises borrowers that they have the right to negotiate terms
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What is the purpose of the Affiliated Business Arrangement? (ABA)
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discloses to consumer that he is not required to use the services of a lender referred business and can shop for other settlement providers
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What is disclosed on the ABA?
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-description of business arrangement, % of ownership in referring party
-estimate of costs for provider -statement that borrower is not required to use any particular settlement provider |
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When is the Homeownership Counseling Organizations List Disclosure to be disclosed?
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Within 3 business days of loan application
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When is the Homeownership Counseling Organizations List Disclosure to be disclosed?
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Within 3 business days of loan application
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which plans are exempt from receiving the homeownership counseling disclosure?
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Reverse Mortgages and timeshare plans
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Section 6 of RESPA
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servicing; specific policies and procedures
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Errors in the servicing of a borrowers loan account must be addressed by servicer when?
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Upon written notice from the borrower
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Errors in the servicing of a borrowers loan account must be addressed by servicer how?
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Upon written notice from the borrower
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When must servicer provide written response acknowledging the notice of error from borrower?
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Within 5 days of receiving notice
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How long to provide a notice of error for failure to provide accurate payoff balance?
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Within 7 days of receiving notice
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How long to disclose notice of error for foreclosure process violations?
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Prior to date of foreclosure sale or within 30 days
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Notice of error for all other errors:
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Within 30 days
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A request for identity of the creditor:
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Within 10 days
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All other information requests:
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Within 30 days
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Force-Place Insurance notice:
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At least 45 days
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Force-Place Insurance notice:
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At least 45 days
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Force-Place Insurance Reminder Notice
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30 days after delivering first notice, and 15 days before a servicer assesses force-placed insurance charge
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Servicers are prohibited from starting a pre-foreclosure review unless the mortgage loan account is _______ days delinquent?
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120 days
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Mortgage Servicing Disclosure Statement (MSDS)
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Advises borrowers whether their loan can be sold, assigned, or transferred for servicing during term.
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Mortgage Servicing Disclosure Statement (MSDS)
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Advises borrowers whether their loan can be sold, assigned, or transferred for servicing during term.
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When is the MSDS due?
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Within 3 days of the completion of the 1st lien mortgage app
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Notice of Transfer Statement
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Informs borrowers about the actual transfer of the servicing of mortgage loan to a new lender/servicer.
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Section 9 of RESPA
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Prohibits seller from requiring a buyer to use a specific title insurance company as a condition of sale.
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Section 10 RESPA
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Ensures consumers they know about the amount of funds deposited in their escrow account
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Initial escrow statement
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Due to borrower no later than 45 days after escrow account is established or at closing
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