TIL quiz questions
The Truth in Lending Act requires disclosure to an applicant of
discount points to be paid to the lender.
Interest, service charges, transaction charges, buyer's points, loan fees and mortgage insurance are examples of what is included in the dollar amount called the
finance charge.
Under TILA, which of the following is TRUE about a higher priced mortgage loan?
The creditor cannot charge a prepayment penalty if the source of the prepayment funds is a refinancing by the creditor or its affiliate.
Which of the following documents shows the cost of a loan expressed as an annual percentage rate?
TIL Disclosure
The Truth in Lending Act does all of the following EXCEPT
TILA does not set interest rates. It does require disclosures to enable consumers to compare costs of credit offered, provide rescission rights for some transactions, and impose restrictions on home equity lines of credit (as a result of the Homeownership and Equity Protection Act).
The Truth in Lending Act requires disclosure of
TILA requires a disclosure of the terms of the credit transactions, including costs and key provisions. RESPA requires disclosure of closing costs and loan servicing practices. ECOA requires disclosure of the appraisal.
A limit on the amount of interest or loan fees a creditor may charge is imposed by
...
Advertisements for Credit Secured by a Dwelling
...
When a consumer exercises his right to rescind a loan under TILA, all loan fees must be refunded within
20 days
At least how many business days prior to closing must the borrower be given the early Truth in Lending Disclosure?
7
The early TILA disclosure must be provided to a borrower at least how many business days prior to closing?
7
Regulation Z was issued to implement the Truth in Lending Act by
the Board of Governors of the Federal Reserve System.
TILA restrictions for higher priced mortgage loans limit any prepayment penalty to
the first two years.
For how long after the date disclosures are required to be made or action is required to be taken must a creditor retain evidence of compliance with Regulation Z?
two
If a mortgage ad states "low down payment," what else is required in the ad?
Nothing else (as long as there is no $ amount, nothing else is required)
A creditor must provide the TILA disclosure within how many business days after receipt of a residential mortgage loan application?
Three
The Truth in Lending Act (TILA) does not include which of the following as finance charges in a residential loan transaction?
Appraisal fees
The Truth in Lending Act is within which law?
Consumer Credit Protection Act
Which of the following federal agencies creates the regulations for TILA?
Federal Reserve System
The Truth in Lending Act provides that a lender refinancing a residential property must give the borrower
a new TILA disclosure for the new loan.
The Truth in Lending Act applies to
home loans.
TILA restrictions for higher priced mortgage loans require an escrow account
only if the loan is a first lien on the borrower's principal dwelling.
According to TILA, a loan cost paid separately before or at consummation of a transaction, or withheld from the proceeds of a loan is a
prepaid finance charge.
Which of the following is TRUE about the right of rescission granted under the Truth in Lending Act?
It only applies to a loan secured by the borrower's principal residence.
Which of the following would be included in the calculation of the APR for a closed-end loan?
Loan Origination Fee Money that is paid to and kept by a lender is a finance charge, included in the APR calculation. This includes the loan origination fee. With regard to real estate transactions, the other choices are closing costs reported under RESPA.
Which of the following are included in the finance charges for a real estate transaction?
MIPS
An applicant received TILA disclosures in person on Monday, May 1, and then received corrected disclosures that were personally delivered on Wednesday, May 3. The earliest the transaction may be consummated is
May 9th
Which of the following would be considered prepaid finance charges in a transaction secured by real estate?
Mortgage broker fees
All of the following may be included in calculation of the APR EXCEPT
Mortgage insurance premiums.
According to TILA, a variation up to what amount is permitted for the annual percentage rate in a regular fixed rate mortgage transaction?
One-eighth of one percent
What type of loan could be subject to HOEPA?
Second mortgage on a primary residence
A Truth in Lending Disclosure Statement provided for a home loan shows all of the following EXCEPT the Appraisal Fee
The TILA disclosure shows the APR, monthly payments and amount financed (the loan amount less finance charges). For real property loans, it does not include property appraisal fees.
Which of the following appears in the Truth in Lending Disclosure Statement?
The loan term
An ARM disclosure includes all of the following EXCEPT
The rate after the starting initial rate cannot be included in the disclosure, as it will not be determined until later. The lender must disclose the initial rate and the period for that rate, as well as the frequency of rate change.
In a comparison of annual percentage rates for two separate loan programs which of the following should be the same?
The term of each loan
Which of the following is not a required disclosure under the Truth in Lending Act?
Title charges Loan costs must be disclosed under Truth in Lending and Regulation Z. Title charges are closing costs disclosed under RESPA and Regulation X.
Which law requires distribution of the CHARM booklet to certain mortgage loan applicants?
Truth in Lending Act (TILA)
Which of the following would be considered part of the finance charge when figuring the annual percentage rate under the Truth-in-Lending Act (Regulation Z)?
Truth-in-Lending applies to loans made to individuals for personal, family, or household purposes. For personal property loans the law only applies if the loan does not exceed $25,000. For residential real property loans the law applies regardless of the loan amount. It does not apply to business, agricultural or commercial loans or loans made to partnerships, corporations, etc. The lender must disclose all finance charges (loan fees, finder's fees paid to the person bringing the borrower to the lender, service charges, points, mortgage insurance premiums and interest). He must add these charges together and calculate them as a percentage of the loan balances during the term of the loan to arrive at an "annual percentage rate" (APR). The APR can then be used as a means of comparing costs among lenders. Actual costs not retained by lenders (title fees, legal fees, closing costs, property taxes, appraisal fees, recording fees, notary fees, etc.) are not considered finance charges and are not included in the APR.
According to the Truth In Lending Act, when does refinancing occur?
When an existing obligation is satisfied and replaced by a new obligation.