Real Estate Documentation & Compliance Flashcards

Under TRID, at least how many business days before consummation must the borrower receive the Closing Disclosure?

Answer: 3 business days

TRID requires the borrower to receive the Closing Disclosure at least 3 business days before consummation.

Which change after the Closing Disclosure is issued triggers a new 3-business-day waiting period?

Answer: The APR becoming inaccurate beyond the allowed tolerance

A new waiting period is required if the APR becomes inaccurate, the loan product changes, or a prepayment penalty is added.

Which RESPA section bans kickbacks and unearned fees for referring settlement service business?

Answer: Section 8

RESPA Section 8 bans giving or accepting anything of value for referrals of settlement service business.

Under RESPA Section 9, what is a seller not allowed to do in a federally related mortgage transaction?

Answer: Require the buyer to buy title insurance from a specific title company

Section 9 stops sellers from requiring, as a condition of sale, that buyers buy title insurance from a particular company.

A lender gets a complete loan application on Monday. Under TRID, when is the Loan Estimate due?

Answer: Within 3 business days

The creditor must deliver or mail the Loan Estimate within 3 business days of receiving the application.

In a transaction under TRID, who is mainly responsible for delivering the Closing Disclosure to the borrower?

Answer: The creditor (lender), even if it delegates preparation to the settlement agent

The creditor keeps legal responsibility for the Closing Disclosure even when a settlement agent prepares or delivers it.

An agent asks the transaction coordinator to backdate a signed addendum so it appears to meet a passed contingency deadline. What should the TC do?

Answer: Refuse, and document the actual dates or prepare a proper extension amendment

Backdating misrepresents the record and may be fraud, so the right fix is a properly dated extension or amendment.