Mortgage Federal Mortgage-Related Laws 3

Question 1

Under ECOA, a creditor must notify a loan applicant of an adverse action within how many days of receiving a completed application?

Accepted Answer

30 days

Answer

ECOA and Regulation B require creditors to provide an adverse action notice within 30 days of receiving a completed application.

Question 2

Which protected class was added to the Fair Housing Act by the 1988 amendments?

Accepted Answer

Familial status and disability

Answer

The Fair Housing Amendments Act of 1988 added familial status and disability (handicap) to the original protected classes.

Question 3

HMDA requires covered lenders to collect and report data on mortgage applications primarily to:

Accepted Answer

Detect and deter discriminatory lending patterns

Answer

HMDA data is used by regulators and the public to identify potential discriminatory or predatory lending practices across geographic areas.

Question 4

Under the Fair Housing Act, which of the following lender actions is considered illegal steering?

Accepted Answer

Directing minority applicants toward higher-cost loan products without objective basis

Answer

Steering occurs when lenders direct borrowers to less favorable loan products based on a protected characteristic rather than creditworthiness.

Question 5

The Community Reinvestment Act (CRA) was enacted primarily to address:

Accepted Answer

Redlining and the failure of banks to serve low- and moderate-income communities

Answer

CRA was enacted in 1977 to encourage depository institutions to help meet the credit needs of the communities they serve, including low- and moderate-income neighborhoods.

Mortgage Practice Test

Mortgage Practice Test

Mortgage Federal Mortgage-Related Laws 3