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26 Cards in this Set
- Front
- Back
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How far should comparable properties be in the appraisal market approach? |
within 1 mile
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What is loan suitability?
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A term that refers to the maching of loan programs with the current financial cirmumstance of the brorower.
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When must an applicant receive an adverse action notice if they do not qualify for a loan?
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Within 30 days
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What is an aggregate escrow analysis used for?
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To make sure there are no escrow overages; to ensure that borrowers are not being forced to maintain any surplus over the allowed 2 month cushion
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What does section 8 of RESPA state?
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It is prohibited for a mortgage professional to give or accept any sort of referal or kickback fee
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What agency is responsible for creating the regulations for TILA?
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The Federal Reserve
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What does LIBOR stand for and what is it's relation to mortgages?
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London Interbank Offered Rate. It is one of the main methods of determining ARM adjustments.
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What is a reconveyance clause?
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It removes the lien on a property once the loan is paid off in full.
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What is another term for a Junior Lien?
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Subordinate lien
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What sort of information is included in the Market Conditions Addendum?
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An inventory of homes in the neighborhood, Existence of foreclosures in the neighborhood, market conditions.
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In order to meet fair lending requirements, what test must a credit scoring system be based on?
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Validity Test
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What is the amount of MIP for FHA loans based on?
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The LTV
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What is redlining?
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Refusing to originate loans in areas that are perceived to have a lack of creditworthiness
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How does TILA describe a creditor?
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One who regularly extends credit
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Describe a 'discount point'.
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A discount point is 1% of the loan amount
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What does COFI stand for?
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Cost Of Funds Index
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What does “Easement” mean?
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A right to cross or otherwise use someone else's land for a specified purpose
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Describe Subprime lending.
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Subprime Lending is making riskier loans to people who may have difficulty paying them back. Usually have higher interest rates and less favorable terms.
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What is a buy down loan?
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A fixed rate loan where you can reduce the interest rate and monthly payment amount for a specific period of time by paying a fee up front
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Describe “loan flipping.”
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Loan Flipping is a type of predatory lending in which the lender convinces you to refinance your home(sometimes several times) when there is either no benefit in it for you, or there is something hidden in the fine print such as a balloon payment.
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What is SRP(Service Release Premium)?
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SRP is the payment received by the bank or lending institution when selling a closed loan in the secondary market. Such as Fannie Mae or Freddie Mac.
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What is YSP(Yield Spread Premium)?
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Also known as “Borrower Credit” or “Lender Credit.” The money paid to a mortgage broker for giving a borrower a higher interest rate on a loan that is applied towards the borrower’s closing costs.
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What does HECM stand for, what is it, and what is the minimum age limit?
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Home Equity Conversion Mortgage. It’s a reverse mortgage, meaning the borrower is no longer required to make a mortgage payment, and the monthly interest is instead tacked onto the principle balance of the loan. Minimum age for a reverse mortgage is 62.
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On a particular loan a seller’s concession can be up to 6%. Is it 6% of the purchase price or the loan amount?
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6% of the purchase price
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What is the Red Flags Rule and what is its main purpose?
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The Red Flags Rule is a measure in FACTA to address identity theft. Its main purpose is to identify patterns and detect irregularities that may indicate identity theft
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If a loan had prepayment penalties, which documents would disclose them?
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The TILA disclosure and the promissory note
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