Federal Mortgage Related Laws

Front 1

Dodd - Frank Act

Back 1

Established the CFPB (Consumer Financial Protection Bureau) to consolidate federal regulatory authority

Front 2

SAFE Act - Purpose

Back 2

Enhance consumer protection and reduce fraud by establishing minimum standards for licensing/registration of MLO's

Front 3

SAFE Act - Regulatory Authority

Back 3

CFPB ( Consumer Financial Protection Bureau)

Front 4

RESPA - Purpose

Back 4

Real Estate Settlement and Procedures Act:

Protect consumers by regulating costs and business arrangement disclosures

Regulation X - Provides Clarification of the rules governed by RESPA

Front 5

RESPA - Regulatory Authority

Back 5

CFPB

Front 6

RESPA - Disclosures

Back 6

Good Faith Estimate

HUD-1 & HUD-1A

Settlement Cost Booklet

Affiliate Business Arrangement

Homeownership Counseling Organizations List Disclosure

Front 7

RESPA - Good Faith Estimate

Back 7

Initial disclosure of estimated settlement cost of a mortgage loan; expressed in dollar amount.

No charges may be collected prior to GFE

Must be provided no later than 3 business days after loan application

Front 8

RESPA - HUD-1 & HUD-1A

Back 8

HUD-1: Purchase, for borrower&seller

HUD-1A: Refinance, only for borrower

Clearly shows all of the final charges in connection with the settlement of the loan

Must be provided to the consumer at the time of closing

Front 9

RESPA - Settlement Cost Booklet

Back 9

AKA: Shopping for your home loan

Must be provided within 3 business days of application for a purchase transaction

Must be a separate and distinct document

Front 10

RESPA - Affiliated Business Arrangement

Back 10

Disclosure that must be given to the consumer if the lender has recommended an affiliated business for settlement services

Due at the time of referral

Front 11

RESPA - Homeownership Counseling Organizations List Disclosure

Back 11

Lenders must provide applicants with a list of homeownership counseling organizations

Within 3 business days of loan application

Front 12

RESPA - Section 6

Back 12

Servicing requirements:

Error Resolution and Information Requests

Timely Escrow Payments

Force-Placed Insurance

Early Intervention/Loss Mitigation

Prohibition on Foreclosure Process

Mortgage Service Disclosure Statement

Notice of Transfer Statement

Front 13

RESPA - Section 8

Back 13

Prohibits the payment of referral fees, fee splitting, unreasonable charges, illegal agreements etc. KICKBACKS

Front 14

RESPA - Section 9

Back 14

Prohibits a seller from requiring a buyer to use specific title insurance company, allows the buyer to shop

Front 15

RESPA - Section 10

Back 15

Protect consumers by ensuring that they know about the amount of funds deposited into their escrow accounts

Front 16

RESPA - Penalties/Records

Back 16

Statute of Limitations penalties: 3 yrs

Records must be retained for five years

Front 17

ECOA - Purpose

Back 17

Equal Credit Opportunity Act was enacted to address discrimination in lending practices(in relation to credit)

Front 18

ECOA - Regulatory Authority

Back 18

CFPB

Front 19

ECOA - Disclosures

Back 19

Notice of Action Taken

ECOA Valuation Rule

Notice of right to receive an appraisal

Government Monitoring

Front 20

ECOA - Penalties/Records

Back 20

Civil Penalties can be up to $5000/day

Records must be kept for 25 months

Front 21

HMDA - Purpose

Back 21

Home Mortgage Disclosure Act was created due to concern about credit shortages in geographically specific areas

Front 22

HMDA - Regulatory Authority

Back 22

CFPB

Front 23

HMDA - LAR

Back 23

Loan Application Register

Front 24

HMDA - Penalties / Records

Back 24

Civil penalties

LAR Data public for three yrs

Front 25

TILA - Purpose

Back 25

AKA Regulation Z

Created to help ensure that consumers were informed on the cost of obtaining credit

Front 26

TILA - Regulatory Authority

Back 26

CFPB

Front 27

TILA - Disclosures

Back 27

Open-End Mortgage Disclosure

Closed-End Mortgage Disclosure

Consumer Handbook on ARM(CHARM booklet)

Early ARM disclosure

Front 28

TILA - Provisions

Back 28

Right to rescind

Advertising Requirements

Section 32 High Cost Mortgage Loans

Front 29

TILA - HOEPA

Back 29

Home Ownership and Equity Protection Act

Protect consumers from unethical lending practices specifically related to high-cost or high-rate loans

Front 30

HOEPA - Section 35

Back 30

Higher Priced Mortgage Loans:

No creditor can make a higher priced mortgage loan without first considering the consumer's repayment ability

Higher Priced Mortgage Loan defined as:

APR is 1.5% or more above APOR

APR on jumbo loan is 2.5% or more above APOR

APR on 2nd lien is 3.5% or more above APOR

Mandatory Escrow Account

Appraisal Standards and Disclosures

Additional Appraisal Rule for section 35

requires 2 written appraisals

Front 31

TILA - Penalties and Recording

Back 31

Knowingly violating - $5,000 fine & 1 year in prison

Records required for two years

Front 32

FCRA and FACTA

Back 32

FCRA - Fair Credit Reporting Act

FACTA - Fair and Accurate Credit Transactions Act

Front 33

FCRA/FACTA Purpose

Back 33

Regulates consumer reporting agencies

Front 34

FCRA/FACTA Regulatory Agencies

Back 34

CFPB

Front 35

Provisions under FCRA

Back 35

Derogatory credit info must be reported on a credit report for no longer than 7 years

Bankruptcies must be reported for no longer than 10 years

Front 36

Disposal Rule

Back 36

Under the jurisdiction of FACTA: Must take reasonable measures to protect against identity theft by disposing of consumers info

Front 37

Red Flags Rule

Back 37

Identity theft prevention program

Front 38

GLBA

Back 38

Gramm-Leach-Bliley Act

Front 39

GLBA Purpose

Back 39

Allow commercial banks and other financial companies such as mortgage bankers and lenders to consolidate and offer multiple financial services under one roof

Non-Public information is defined as personally identifiable info that is not publicly available

Front 40

GLBA Regulatory Authority

Back 40

Mostly by the FTC sectioned in Regulation P and falls under the CFPB

Front 41

The Safeguards Rule

Back 41

"How should we as a business, regulate ourselves?"

Forces financial institutions to take a closer look at how they manage private data and do a risk analysis on their current process

Front 42

Regulation P and Privacy of Consumer Information

Back 42

Requires financial institutions to exercise certain conduct with relation to a consumers and customers nonpublic information

Privacy

Opt Out

Pretexting

Front 43

Do Not Call Laws - Purpose

Back 43

Puts the consumer in control of which phone calls they receive

Front 44

Do Not Call Laws - Regulatory Authority

Back 44

FCC & FTC

FCC - Interstate & Intrastate

FTC - Interstate

Front 45

HPA - Purpose

Back 45

Homeowners Protection Act AKA PMI cancellation act

allows homeowners to cancel PMI

Front 46

HPA - Regulatory Authority

Back 46

CFPB

Front 47

Fair Housing Act - Purpose

Back 47

Enacted to prohibit discrimination in the financing/sale/rental of dwellings

Front 48

Fair Housing Act - Regulatory Authority

Back 48

HUD

Front 49

MARS - Purpose

Back 49

Mortgage Assistance Relief Services bans service providers from collecting fees prior to providing a result

Front 50

MARS - Regulatory Authority

Back 50

CFPB

Front 51

Mortgage Acts and Practices - Advertising

Back 51

Stemming from the 2009 Omnibus appropriations act, REGULATION N OF DODD FRANK

Front 52

Mortgage Acts and Practices - Advertising PURPOSE

Back 52

Protects consumers from mortgage related misrepresentations in advertising

Front 53

Financial Crime Rules

Back 53

USA Patriot Act

BSA/AML

Front 54

USA Patriot Act

Back 54

Title 3 of the act focuses on identity theft and money laundering through financial transactions in support of terrorist activities

Front 55

BSA/AML

Back 55

Bank Secrecy Act or the Anti Money Laundering law

Created to thwart drug traffickers and tax cheats

Authorizes the Financial Crimes Enforcement Network(FinCEN)

Front 56

Safe Harbor

Back 56

Corndog Example

Front 57

Presumption of Compliance

Back 57

Hot Dog Example