Federal Laws and Regulations Flashcards

Under RESPA, which practice is prohibited between settlement service providers?

Answer: Paying or receiving kickbacks for referrals

RESPA Section 8 prohibits kickbacks and fee-splitting arrangements between settlement service providers for referrals.

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

Answer: Identify possible discriminatory lending patterns

HMDA data is used by regulators and the public to identify and address discriminatory or predatory lending practices.

Which federal law establishes the right of rescission for certain mortgage transactions?

Answer: TILA

The Truth in Lending Act (TILA) grants borrowers a three-business-day right to rescind certain non-purchase mortgage transactions.

A lender denies a loan application citing the applicant's receipt of public assistance income as the reason. This most likely violates:

Answer: ECOA

ECOA prohibits discrimination based on the fact that income derives from a public assistance program.

Under Dodd-Frank, which agency has primary supervisory authority over large non-bank mortgage servicers?

Answer: CFPB

The Consumer Financial Protection Bureau (CFPB) has supervisory and enforcement authority over large non-bank mortgage servicers under Dodd-Frank.

The Homeowners Protection Act requires automatic cancellation of PMI when the loan balance reaches what percentage of the original property value?

Answer: 78%

The HPA mandates automatic PMI cancellation when the loan-to-value ratio drops to 78% of the original purchase price based on the amortization schedule.

Which federal regulation implements ECOA's requirements as they apply to mortgage lending?

Answer: Regulation B

Regulation B implements ECOA, which prohibits discrimination in credit transactions including mortgage lending.