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19 Cards in this Set
- Front
- Back
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The truth in lending act is AKA: |
regulation Z. G1170.16 |
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The truth in lending act (TILA) does NOT protect: |
a) investors b) commercial borrowers c) agricultural borrowers d) buyers of 5+unit bldgs. G1170.16 |
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A "creditor" is a person or institution who originates ___ or more loans per year, using residential property as collateral. |
4 +. G1170.16 |
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What is on the loan estimate (LE) page 1? |
the basics about the loan. G1170.16 |
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What is on the loan estimtate (LE) page 2? |
a) services you can shop for (pest control, title services, etc) b) services you cannot shop for (appraisals, etc) c) other costs (taxes, fees, prepaids (ins. & taxes)) G1170.16 |
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What is on the loan estimate (LE) page 3? |
COMPARISON TOOLS: a) 5 year principal reduction amount b) APR (not your actual interest rate, only costs of loan expressed as interest rate) c) Total interest % (TIP): total interest paid over life of loan as a % of loan amount. d) other considerations, such as prepayments and refinancing allowed d) borrower's signature |
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APR: |
lender costs combined with interest rate. Used to compare/shop for lender's loan terms. G1170.16 |
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True or false: the APR is the same as your interest rate on a loan: |
False, false, FALSE!. APR includes interest rate, plus lender costs. G1170.16 |
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When is a new loan estimate required? |
Significant changes, or more than 1/8th% change in APR. G1170.16 |
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The right of rescission is for __________ loans only. |
a) home equity type loans b) refinancing c) primary residences . G1170.16 |
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John takes out a business loan. Does he have the right of rescission? |
No. G1170.16 |
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John refinances his primary residence. Does he have a right of rescission? |
Yes. G1170.16 |
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John refinances his investment property in which he does not live. Does he have a right of rescission? |
No. Because it is not a primary residence. G1170.16 |
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John buys a new primary residence with a loan. Does he have a right to rescission? |
No, because it's a new purchase. G1170.16 |
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Sarah gets several lenders to quote APRs for their loans so she can evaluate her options. Should Sarah take the APRs at face value? |
No, they might include or exclude costs such as appraisals and title insurance. G1170.16 |
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APRs usually include: |
a) origination fees b) mortgage insurance c) discount points d) processing fees G1170.16 |
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Which loan will have the higher APR, all things being held constant except length of loan: a 30 yr loan or 15 yr loan?
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the 15 year loan will have higher APR. G1170.16
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What are "trigger" terms: |
In advertising, use of one term requires disclosure of all other loan terms, except for APR used alone. Terms included: down pmt, amount of loan, pmt, frequency of pmt, total payoff amt. G1170.16 |
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ARM loans must be accompanied by what disclosures: |
a) historic interest rates b) potential changes to THIS loan (max, min, pace of changes, etc) c) consumer handbook d) Index the loan uses for changes. G1170.16 |
