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28 Cards in this Set

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1. You are receiving a mortgage from your local bank. Regulation Z requires your bank to disclose

1. your right to rescind within three business days.
2. the amount of your closing costs.
3. the annual percentage rate.
4. penalties to the bank if they do not comply with the laws.
1. (3) Regulation Z requires lenders to inform borrowers of the true cost of credit, which includes the Annual Percentage Rate (APR). Kickbacks or referral fees are prohibited. (118-119)
2. The federal fair housing laws prohibit discrimination on the basis of

1. sexual orientation.
2. political beliefs.
3. marital status.
4. sex.
2. (4) Some states and local governments prohibit discrimination on the basis of sexual orientation, political beliefs, and marital status. (114)
3. Persuading someone to sell by telling her or him that minorities are moving into the neighborhood is illegal and is called

1. redlining.
2. blockbusting.
3. testing.
4. steering.
3. (2) Redlining is denying loans or insurance to people in selected neighborhoods regardless of their qualifications. Testing is done to enforce the law, and steering restricts freedom of choice. (116)
4. Which of the following is exempted from the federal fair housing laws?

1. Rental of rooms in an owner-occupied five-family dwelling
2. Rental of an owner-occupied five-family dwelling
3. Rental of a single-family home when a broker is used
4. Lodgings of a private club when the lodgings are not operated commercially
4. (4) The exemption applies to up to four units of owner-occupied rental housing. (117)
5. The practice of channeling potential buyers of one race into one area and potential buyers of another race into another area is known as

1. canvassing.
2. blockbusting.
3. redlining.
4. steering.
5. (4) Canvassing involves personal solicitation of opinions or sentiments which is generally legal. Blockbusting and redlining were discussed above and are illegal. (116)
6. A real estate broker may

1. refuse to rent to a qualified minority person.
2. solicit listings in a minority neighborhood.
3. refuse to negotiate with a minority person.
4. change the terms of sale for a minority person.
6. (2) Discrimination is treating people differently when they are members of a protected class. (116-117)
7. The federal fair housing laws prohibit which of the following types of private housing?

1. A Lutheran organization giving preference to its members in renting
2. A Norwegian advertising his house for "Norwegians only"
3. The Elks Club operating a rooming house on a nonprofit basis
4. A Masonic Lodge operating a rooming house when the lodgings are not operated commercially
7. (2) Religious organizations and private clubs may discriminate under certain circumstances. An individual homeowner must comply with certain conditions to be exempt from federal fair housing laws. (117)
8. Which of the following categories is NOT protected against discrimination under the federal fair housing laws?

1. Religion
2. Familial status
3. Disabled status
4. Lawful source of income
8. (4) Nevertheless, lawful source of income is a protected class in some states. The Federal Equal Credit Opportunity Act also protects borrowers in a similar manner. (114)
9. The denial of a loan by a lender would NOT be a violation of federal fair housing laws if it were based on

1. lack of income.
2. sex
3. age
4. marital status
9. (1) Lack of income is an acceptable reason for denying a loan, provided all lawful sources of income are considered as discussed above. (117)
10. Which of the following laws provides comprehensive guidance for making public facilities accessible?

1. RESPA
2. Regulation Z
3. Federal fair housing laws
4. Americans with Disabilities Act (ADA)
10. (4) Regulation Z is the Truth-in-Lending Law. Ginnie Mae functions in the secondary mortgage market. Federal fair housing law does not deal with accessibility to public facilities. (117-118)
11. Which of the following activities would be legal under the familial status category of the federal fair housing laws?

1. Charging higher rents for people with pets
2. Charging higher security deposits for families with children
3. Segregating families within buildings
4. Segregating families in certain buildings
11. (1) Since pets are not a protected class, landlords may charge higher rents for renters with pets. (115)
12. Which of the following agreements would be covered by Regulation Z?

1. A personal property credit transaction for $30,000
2. A commercial loan
3. An agricultural loan for $15,000
4. A loan to an individual for a personal property credit transaction for $20,000
12. (4) A loan to an individual for a personal property credit transaction for no more than $25,000 would be covered by Regulation Z. (118-119)
13. Which of the following finance charges would NOT be used by a bank to calculate the annual percentage rate for disclosure to the borrower?

1. Loan fees
2. Credit fees
3. Home inspection fees
4. Service charges
13. (3) Home inspection fees are not related to the finance charges. (119)
14. 'Trigger terms" relates to

1. the ADA.
2. federal fair housing laws.
3. RESPA.
4. Regulation Z.
14. (4) Brokers advertising credit terms must fully disclose terms of credit if they use "trigger terms." (119)
15. The right of rescission provided by Regulation Z is for a time period of

1. two business days following the transaction or until delivery of the disclosure statement, whichever is later.
2. three business days following the transaction or until delivery of the disclosure statement, whichever is later.
3. four business days following the transaction or until delivery of the disclosure statement, whichever is later.
4. five business days following the transaction or until delivery of the disclosure statement, whichever is later.
15. (2) It is important to emphasize that the right of rescission does not apply to loans to finance the purchase or initial construction of a house. (119)
16. The Americans with Disabilities Act became law in

1. 1968. 3. 1990.
2. 1989. 4. 1994.
16. (3) Moreover, an amendment to the 1968 Federal Fair Housing Act to add handicapped and familial status as protected classes became effective in 1988. (117)
17. Converting information on a real estate listing to large-print or audio format would be a response to

1. federal fair housing laws.
2. the Americans with Disabilities Act.
3. Regulation Z.
4. RESPA.
17. (2) The 1968 Federal Fair Housing Act includes handicapped as a protected class, but the specific measures are identified in the ADA. Regulation Z requires disclosure of cost in a credit transaction. RESPA is aimed at protecting consumers from abusive lending practices. (117-118)
1. Attaching grab bars to a restroom stall
2. Providing automatic entry doors
3. Providing an automatic sprinkler system
4. Converting real estate listing information to large print or audio format
18. (3) The fire codes would require the providing of an automatic sprinkler system. (117-118)
19. Which of the following rental practices would be legal under federal fair housing laws?

1. A property manager discloses to the landlord that a prospective tenant is a minority
2. A property manager charges a mother and her six-year-old son a higher security deposit than another woman with no children
3. A rental agent refuses to rent an apartment to a person who is a convicted drug dealer
4. A property manager refuses to rent to a blind man because he has a seeing-eye dog and the property does not allow dogs.
19. (3) Convicted drug dealers are never protected under federal fair housing laws. (115)
20. The Civil Rights Act of 1866 prohibits discrimination in housing on the basis of

1. religion. 3. sex.
2. race. 4. handicap
20. (2) The Civil Rights Act of 1866 makes clear that there is no situation in which racial discrimination may be practiced. (114)
21. Which of the following is not a protected class under the Federal Equal Credit Opportunity Act?

1. Marital status
2. Age
3. Sexual orientation
4. Dependency on public assistance
21. (3) Sexual orientation is a protected class in nine states; however, it is not protected under federal housing or lending laws. (117)
22. Disclosure of cost in a credit transaction is required by

1. RESPA.
2. Regulation Z.
3. the Federal Equal Credit Opportunity Act.
4. the 1968 Federal Fair Housing Act.
22. (2) RESPA provides consumer protection with regard to closing procedures and costs. The Federal Equal Credit Opportunity Act prohibits credit providers from discriminating against members of certain protected classes. The 1968 Federal Fair Housing Act prohibits discrimination in the sale or rental of housing. (118-119)
23. According to the Federal Equal Credit Opportunity Act, a rejected credit applicant must be informed, in writing, of the reason for credit denial within

1. 3 days. 3. 30 days.
2. 10 days. 4. 90 days.
23. (3) The Federal Equal Credit Opportunity Act also states that a borrower is entitled to a copy of the appraisal report, paid for by the borrowers. (117)
24. A second violation of the Americans with Disabilities Act can result in a civil penalty of up to

1. $10,000. 3. $50,000.
2. $25,000. 4. $100,000.
24. (4) A penalty of up to $ 100,000 may be assessed for any subsequent violation of the Americans with Disabilities Act. (118)
25. Regulation Z is administered by the

1. Federal Trade Commission.
2. Department of Housing and Urban Development.
3. Federal Reserve System.
4. Federal Housing Administration.
25. (1) Regulation Z is promulgated by the Federal Reserve System. (118-119)
26. A landlord allowed a tenant confined to a wheelchair to make several minor physical changes to an apartment. These changes are called

1. disability accommodations.
2. familial accommodations.
3. trade fixture modifications.
4. reasonable accommodations or modifications.
26. (4) Under federal law the tenant is allowed (at the tenant's expense) to make reasonable modifications. (117-118)
27. Which of the following is a legitimate landlord action under fair housing's familial status?

1. Charging a higher security deposit for families with children
2. Segregating families within a building
3. Segregating families into certain buildings
4. Limiting occupancy based on honest square footage limits
27. (4) The landlord is allowed to limited the number of people in a unit based on square footage. (115)
28. Most states require real estate licenses to be conspicuously displayed by their broker. What else is the broker of a real estate office required to conspicuously display?

1. EHO poster
2. Listings
3. Civil Rights Act of 1866
4. ECOA legislation
28. (1) The Equal Housing Opportunity poster with the logo of an equals sign inside the outline of a house. (117)