CMA Mortgage Regulations and Compliance 2

Question 1

Under RESPA, what is the maximum tolerance for increases in third-party settlement service charges between the Loan Estimate and Closing Disclosure?

Accepted Answer

10%

Answer

RESPA allows a 10% tolerance for third-party charges where the borrower was permitted to shop but selected a provider from the lender's written list.

Question 2

Which federal law prohibits mortgage lenders from discriminating based on the racial composition of a neighborhood?

Accepted Answer

Fair Housing Act

Answer

The Fair Housing Act prohibits redlining and other discriminatory practices based on race, color, religion, national origin, sex, disability, or familial status.

Question 3

A loan officer collects a $500 application fee before providing the Loan Estimate. Under TRID rules, this practice is:

Accepted Answer

Permitted only for credit report fees

Answer

TRID prohibits collecting any fees before the borrower receives and indicates intent to proceed with the Loan Estimate, except for a bona fide credit report fee.

Question 4

The Home Mortgage Disclosure Act (HMDA) requires lenders to collect and report data primarily to:

Accepted Answer

Identify potential discriminatory lending patterns

Answer

HMDA data collection helps regulators and the public identify whether lenders are serving the housing needs of their communities and detect discriminatory lending patterns.

Question 5

Under Regulation Z, the right of rescission for a refinance transaction expires how many business days after the last of three triggering events?

Accepted Answer

3 business days

Answer

Borrowers have 3 business days to rescind after consummation, delivery of the rescission notice, or delivery of all material disclosures, whichever occurs last.

(CMA) Certified Mortgage Advisor Practice Test

(CMA) Certified Mortgage Advisor Practice Test

CMA Mortgage Regulations and Compliance 2