CHCP Regulatory Compliance & Legal Issues 4

Question 1

A deed of trust differs from a mortgage primarily in that a deed of trust:

Accepted Answer

Involves three parties including a neutral trustee

Answer

A deed of trust involves three parties — the borrower, lender, and a neutral trustee — allowing non-judicial foreclosure in most states that recognize it.

Question 2

Under the Americans with Disabilities Act (ADA), which type of property is MOST likely subject to accessibility requirements enforceable at closing?

Accepted Answer

Commercial properties used as places of public accommodation

Answer

The ADA primarily applies to commercial facilities and places of public accommodation, not private residential properties.

Question 3

A closing agent is instructed by the lender to backdate the closing documents by one week. The agent should:

Accepted Answer

Refuse, as backdating documents constitutes fraud

Answer

Backdating closing documents is a form of mortgage fraud and a federal crime regardless of who instructs the agent to do so.

Question 4

Which of the following best describes a 'mechanic's lien' in the context of a real estate closing?

Accepted Answer

A claim filed by contractors or suppliers for unpaid work on the property

Answer

A mechanic's lien is a statutory lien filed by contractors, subcontractors, or material suppliers who were not paid for work or materials provided to improve the property.

Question 5

The Gramm-Leach-Bliley Act (GLBA) requires title companies and closing agents to:

Accepted Answer

Protect the privacy of nonpublic personal financial information

Answer

GLBA requires financial institutions, including title companies, to safeguard customers' nonpublic personal information and provide privacy notices.

(CHCP) Certified Home Closing Professional Practice Test

(CHCP) Certified Home Closing Professional Practice Test

CHCP Regulatory Compliance & Legal Issues 4