Federal Realestate Settlement Procedures Act: Part 1

Front 1

When must a loan originator provide an Affiliated Business Arrangement (AfBA) disclosure?

Back 1

At or before the time the referral is made.

Front 2

According to RESPA, the special information booklet must be given to whom if two applicants jointly apply for a loan?

Back 2

The booklet need be given to one person only

Front 3

HUD's special information booklet may be reproduced in any form.
True or false?

Back 3

True

Front 4

RESPA does not apply to temporary construction loans.
True or false?

Back 4

True

Front 5

A construction loan is covered by RESPA if it is used as, or may be converted to, permanent financing by the same lender; it's term is two years or more, and it is not to a bona fide builder; or the lender issues a commitment for permanent financing.
True or false?

Back 5

True

Front 6

Can a provider of settlement services have more than 1% ownership interest in another settlement service provider in an affiliated business arrangement?

Back 6

Yes

Hint 6

In an affiliated business arrangement a provider of settlement services may, but is not required to, have more than 1% ownership interest in another settlement services provider

Front 7

What does the special information booklet contain?

Back 7

Information regarding real estate settlement services in a home purchase.

Front 8

What does the special information booklet contain?

Back 8

Information regarding real estate settlement services in a home purchase.

Front 9

What does RESPA require to be included in AfBA disclosure?

Back 9

A statement that the use of the affiliated service provider is not required.

Front 10

Who must deliver the special information booklet to an applicant for a residential mortgage loan according to RESPA?

Back 10

The loan originator

Front 11

How many business days following the receipt of application must a Good Faith Estimate (GFE) be provided?

Back 11

Three

Front 12

What is a home equity loan?

Back 12

A home equity loan is a closed-and second mortgage loan that is in addition to the first mortgage and is secured by the owners equity in the property.

Front 13

RESPA does not include the following:

Back 13

Extension of credit for a business, commercial, or agricultural purpose;
A loan secured by vacant or unimproved property, unless a structure or manufactured home will be constructed or placed on the property using the loan proceeds within two years of the date of settlement;
Or a loan on property of 25 acres or more.

Front 14

A HUD settlement cost booklet must be provided when?

Back 14

It must be provided in a loan transaction involving a loan to purchase a home

Front 15

A HUD settlement cost booklet must be provided when?

Back 15

It must be provided in a loan transaction involving a loan to purchase a home

Front 16

Who administers the Real Estate Settlement Procedures Act?

Back 16

The Consumer Financial Protection Bureau

Front 17

Does a loan originator need to provide a written GFE if the loan application is denied within three business days of the application?

Back 17

No

Hint 17

A mortgage broker must provide a GFE, even if the exact settlement service fees are not known or if he has orally discussed the GFE with the applicant within the three-business-day disclosure period.

Front 18

When was RESPA enacted?

Back 18

1974

Front 19

Regulation X corresponds with which Act?

Back 19

RESPA

Front 20

When must the special information booklet be given?

Back 20

At application for home purchase loan or within three business days.

Front 21

When should the mortgage servicing disclosure be given?

Back 21

At application or within three business days

Front 22

When is the GFE given?

Back 22

App application or within three business days

Front 23

When is the GFE given?

Back 23

App application or within three business days

Front 24

When must the AfBA disclosure statement be given?

Back 24

At or prior to time of referral.

Front 25

Who created regulation X and RESPA?

Back 25

The Department of Housing and Urban Development (HUD)

Front 26

What is a mortgage servicing disclosure statement?

Back 26

It discloses whether the servicing of the loan may be assigned, sold or transferred to any other person at any time while the loan is outstanding.

Front 27

Who prepares the special information booklet?

Back 27

HUD

Front 28

What is an affiliated business arrangement?

Back 28

It is an arrangement in which a person or associate is in a position to refer real estate settlement service business for a federally regulated mortgage loan:
• has either an affiliate relationship with, or a direct or beneficial ownership interest of more than 1% in, a provider of settlement services; and
• refers business to, or influences the selection of ,that provider.

Front 29

How long must a loan originators estimate of the charges and terms be available after the GFE is provided?

Back 29

10 business days

Front 30

How long does a loan originator have to cure a tolerance violation when actual charges at settlement exceed the estimates on the GFE

Back 30

30 days from settlement to refund the excess to the borrower.

Front 31

What charges on a GFE have no tolerance restriction?

Back 31

Settlement services providers not on the loan originator's list who are selected by a borrower.

Front 32

If a GFE is mailed, when is the applicant considered to have received it?

Back 32

The applicant is considered to have received it three calendar days after it is mailed, not including Sundays and federal legal public holidays.

Front 33

What is the tolerance of a lender or mortgage brokers origination charge after a GFE is provided?

Back 33

Zero tolerance

Hint 33

A lender's or mortgage broker's origination charge has a zero tolerance, meaning it cannot change unless a new GFE is provided.

Front 34

What does the term "changed circumstances" apply to?

Back 34

Acts of God, war, disaster or other emergencies;
• information particular to the borrower or transaction that was relied on in providing the GFE that changed or is found to be inaccurate;
• New information particular to the borrower or transaction that was not relied on in providing the GFE;
• or other circumstances such as boundary disputes, the need for flood insurance, or environmental problems

Front 35

What items may not increase above the estimate in the GFE?

Back 35

The origination charge;
Transfer taxes;
And, while the interest rate is locked, the credit or charge for the interest rate chosen and the adjusted origination charge.

Front 36

Which document contains a shopping chart?

Back 36

The GFE

Hint 36

The purpose of the good faith estimate is to allow applicants to shop for lower closing costs

Front 37

Title insurance chosen by the lender has a 10% tolerance for changes on the GFE.
TRUE OR FALSE?

Back 37

True

Front 38

Government recording charges have a 10% tolerance.
TRUE OR FALSE

Back 38

True

Hint 38

Government recording charges have a 10% tolerance. The origination fee has a zero tolerance. Charges with no tolerance restriction include settlement services selected by a borrower who shopped for his own service provider, homeowners insurance and daily interest charges.

Front 39

Can a mortgage broker enter into a rental agreement with the real estate agent to rent office space?

Back 39

Yes, if it is at the prevailing market rate.

Front 40

RESPA and regulation X are under what entitie's jurisdiction?

Back 40

The Consumer Financial Protection Bureau (CFPB)

Front 41

The Dodd-Frank Act granted what entity authority under RESPA?

Back 41

The Consumer Financial Protection Bureau (CFPB)