DODD FRANK Wall Street REFORM & CONSUMER PROTECTION ACT 2010
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle B States you may include a prepayment penalty on QM's in the first 3 years as long as the penalty is not greater than what?
1. 2% of the outstanding loan balance during the first 2 years. 2. 1% of the outstanding loan balance during the 3rd year.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle B Addresses Directing the CFPB to adopt 3 Rules Addressing what?
1. A reasonable, Good Faith ATR Evaluation. 2. Creation of Rebuttal Presumption of the ATR the home loan. If the loan meets the Established Qualified Mortgage Standards. 3. That you MAY include a Prepayment Penalty for QM's.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle B Addresses a reasonable good-faith ATR Evaluation. Which MUST include 8 ATR Underwriting Factors. What are they?
1. Current or Reasonably expected income or assets the consumer will rely on to pay the loan. 2. Current Employment Status. 3. Monthly Mortgage payment FOR THIS LOAN 4. monthly payments on any simultaneous loans secured by the same property. 5. monthly Payments for Property Taxes & Insurance. 6. Debts, Alimony & Child support Obligations. 7. Monthly DTI Ratio or Residual Income 8. Credit History.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle B Addresses Qualified Mortgages as what?
1. Regular Periodic Payments do not result in an increase in balance. (Neg Amortization) 2. Does not have a balloon Payment. 3. Income & Financial Resources have been verified and documented. 4. Fixed Rate loans that the underwriting process based on payment schedule that fully amortizes the loan term & takes into account all taxes and insurance. 5. ARM loan based on maximum rate permitted under the loan during the first 5 years 6. loan complies with the total monthly DTI ratios 7. Points & Fees don't exceed 3% of the loan amount. 8. Term of the loan cannot exceed 30 yrs 9. Creditors must ratio records to show compliance w/ ATR & QM for 3 years.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Monthly mortgage payments for THIS loan is based off of what? (2 parts)
1. The introductory rate or the FIR. 2. Whichever is greater monthly.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 Is divided into how many Titles and how many affect mortgage lending directly?
16 titles 2 affect mortgage lending Title X & Title XIV
Dodd-Frank Wall Street Reform and Consumer Protection Act was enacted by congress when?
2010
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, A person who is NOT an MLO is considered as someone who provides Mortgage Financing for How many properties in what time period?
3 Properties or less WITHIN a 12 month period
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle B Defines a year value associated with QM Arms. How many years?
5 years
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, ATR Stands for what?
Ability to Repay
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV is divided into 8 subtitles. Subtitle A addresses what?
Addresses Residential Mortgage Loan Origination Standards and creates Limitations on Loan Originator Compensation
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle F addresses what?
Appraisal Activities (See TILA)
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Depository institutions are what?
Banks, Credit Unions...
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, How does Title XIV Subtitle A LIMIT Loan Originator Compensation?
By prohibiting Incentives for loan originators to earn additional compensation by steering consumers towards loans or loans with Particular Terms
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV subtitle A Defines what?
Defines WHO and WHO IS NOT an MLO
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle C addresses what Mortgages?
High Cost Mortgages (see HOEPA)
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Loan Modifications are Defined as?
Loan modification is a change made to the terms of an existing loan by a lender. It may involve a reduction in the interest rate, an extension of the length of time for repayment, a different type of loan, or any combination of the three. (Deferment, Forbearance....etc)
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle A Defines who is and who isn't an MLO. What Defines an MLO by this Act?
MLO; 1. Takes Residential Mortgage Loan Applications. 2. Assists a consumer in obtaining or applying to obtain a mortgage loan. 3. Offers or Negotiates terms or a Mortgage.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle H addresses what?
Miscellaneous Provisions
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, XIV Subtitle G addresses what?
Mortgage Resolution & Modification. (Makes it easier for consumers to obtain loan mods)
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle E addresses what?
Mortgage Servicing.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle A Defines who is NOT an MLO by what 3 things?
Not an MLO; 1. Performs PURELY/STRICTLY Admin or Clerical Tasks 2. Performs Only Realestate Brokerage Activities 3. A Person that provides Mortgage Financing for the sale of 3 PROPERTIES or LESS in a 12 MONTH PERIOD
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, The Act itself is generally geared towards what?
Protecting with Rules like keeping borrowers from abusive lending practices by banks.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 Title XIV are provision that apply to who?
Provisions that apply directly to mortgage originators, Servicers & appraisers, specifically loan originators not affiliated with DEPOSITORY INSTITUTIONS
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, What defines Residual Income?
Residual Income is Discretionary Income Left-over each month after paying all major expenses including mortgage payment.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle B Addresses what, other than the 8 ATR Underwriting Factors?
Subtitle B addresses the minimum Standards for Mortgages, and Directs the CFPB to adopt 3 Rules.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Title XIV Subtitle D Authorizes what?
The creation of an Office of Housing Counseling within HUD.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 Title X authorized what?
Title X authorized the creation of the CFPB, transfers regulatory authority from other federal regulatory agencies to the CFPB and outlines ENFORCEMENT RESPONSIBILITIES
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010's purpose is what?
to address issues that relate to financial and investment activities, including lending & Investing