TILA and RESPA Compliance Flashcards
6 cards from real Mortgage Loan Originator practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 TILA and RESPA Compliance flashcards as text
Which of the following triggers a revised Loan Estimate under TRID?
Answer: Borrower requests a different loan product after initial LE
A valid changed circumstance such as a borrower-requested change in loan product allows the lender to issue a revised Loan Estimate and potentially reset tolerances.
Under TILA, what is the 'amount financed'?
Answer: The loan amount minus prepaid finance charges
The amount financed equals the loan amount minus any prepaid finance charges, representing the actual dollars the borrower has use of.
RESPA applies to federally related mortgage loans, which includes loans:
Answer: Secured by a lien on residential real property involving federally insured lenders or federal programs
RESPA covers loans secured by residential real property when made by federally insured lenders, government-sponsored enterprises, or otherwise involving federal connection.
Which party is responsible for ensuring the Closing Disclosure is delivered on time under TRID?
Answer: The creditor (lender)
The creditor bears ultimate responsibility under TRID for ensuring the Closing Disclosure is provided to the borrower at least three business days before consummation.
Under TILA's right of rescission, which transaction is NOT eligible for rescission?
Answer: Purchase money mortgage on primary residence
The right of rescission under TILA does not apply to purchase money mortgages used to acquire the dwelling that secures the loan.
What is the maximum escrow cushion a servicer may hold under RESPA Section 10?
Answer: Two months' escrow payment
RESPA Section 10 limits escrow account cushions to a maximum of two months of escrow payments to protect borrowers from excess withholding.