Mortgage Mortgage Federal Laws and Regulations Questions and Answers 2

Question 1

Under the Real Estate Settlement Procedures Act (RESPA), which of the following is prohibited?

Accepted Answer

Kickbacks or referral fees for settlement services

Answer

Providing a Loan Estimate within three business days

Answer

Requiring an escrow account for taxes and insurance

Answer

Disclosing the Annual Percentage Rate to borrowers

Question 2

What is the primary purpose of the Home Mortgage Disclosure Act (HMDA)?

Accepted Answer

To require lenders to report lending data for fair lending analysis

Answer

To cap interest rates on residential mortgages

Answer

To establish maximum loan-to-value ratios

Answer

To mandate homebuyer education courses

Question 3

Under the Equal Credit Opportunity Act (ECOA), a lender must provide an adverse action notice within how many days of taking negative action on a mortgage application?

Accepted Answer

30 days

Answer

10 days

Answer

45 days

Answer

60 days

Question 4

Which federal law requires mortgage servicers to provide borrowers with an annual escrow account statement?

Accepted Answer

Real Estate Settlement Procedures Act (RESPA)

Answer

Truth in Lending Act (TILA)

Answer

Fair Credit Reporting Act (FCRA)

Answer

Homeowners Protection Act (HPA)

Question 5

The Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) requires mortgage loan originators to do which of the following?

Accepted Answer

Obtain a state license or federal registration through the NMLS

Answer

Complete a property appraisal before closing

Answer

Provide borrowers with a HUD-1 settlement statement

Answer

Submit quarterly reports to the Consumer Financial Protection Bureau

Question 6

Under the Homeowners Protection Act (HPA), a lender is required to automatically terminate private mortgage insurance (PMI) when the loan balance reaches what percentage of the original property value?

Accepted Answer

78%

Answer

80%

Answer

75%

Answer

70%