Explanation: The correct answer is (A) It must be communicated in writing. According to federal regulations, particularly TILA-RESPA Integrated Disclosure Rule (TRID), the borrower's intent to proceed with a mortgage transaction must be expressed in writing.
When you are shopping for a loan, you may contact more than one potential lender to compare available options. If you intend to proceed with a particular mortgage application, you must notify your lender of your intent to proceed by telling the lender you want to move forward with the application for that loan.
Explanation: The statement that is NOT true about the financial responsibility of a mortgage loan originator is (D) A mortgage loan originator must always have his or her own surety bond in an amount that reflects the dollar value of loans originated in the previous year.
A Mortgage Servicing Disclosure Statement, which discloses to the borrower whether the lender intends to service the loan or transfer it to another lender. It also provides information about complaint resolution.
The Truth in Lending Act, or TILA, also known as regulation Z, requires lenders to disclose information about all charges and fees associated with a loan. This 1968 federal law was created to promote honesty and clarity by requiring lenders to disclose terms and costs of consumer credit.
RESPA requires that a "Servicing Disclosure Statement" be given at the time an application for a mortgage servicing loan is submitted or within 3 business days. It must indicate whether the servicing of the loan may be assigned, sold or transferred to any other person at any time while the loan is outstanding.
Borrowers in violation of the terms of the loan or grant documents for the project or applicable Federal regulations, including a work-out agreement, who fail to fully correct a deficiency by a date specified by the Agency in a written notice are in default of their loan or grant documents.
RESPA does not require lenders to impose an escrow account on borrowers; however, certain government loan programs or lenders may require escrow accounts as a condition of the loan. RESPA also prohibits a lender from charging excessive amounts for the escrow account.
Final answer: The borrower is not required to make a down payment as a characteristic of a Qualified Mortgage (QM). The QM focuses on the borrower's ability to repay, limiting the debt-to-income ratio and fees, and ensuring the loan is fully amortized.
Mortgage intent
This is used to secure priority on a mortgage of a vessel before the mortgage is fully executed. A mortgage intent is valid for up to 30 days and can be renewed if required.
As the definition suggests, most letters of intent are not intended to bind the parties to a final agreement, but are a precursor to a final agreement.
The Real Estate Settlement Procedures Act (RESPA) provides consumers with improved disclosures of settlement costs and to reduce the costs of closing by the elimination of referral fees and kickbacks. After taking effect in 1975, RESPA has gone through a number of changes and amendments.
The borrowers' covenants in a Credit Agreement are an agreement the borrowers make to maintain certain conditions (affirmative covenants) or refrain from taking certain actions (negative covenants) during the term of the agreement.
What are the responsibilities of a bank lender under Regulation U? Regulation U has two important requirements for bank lenders: The bank lender must obtain from the borrower, and complete, a purpose statement (form U-1) for each loan secured by margin stock if the loan exceeds $100,000.
Which of the following is true regarding a creditor's duty to give a copy of an appraisal to a borrower? The answer is The lender is always required to provide a copy of the appraisal promptly upon completion or three days prior to consummation for closed-end credit, whichever is earlier.
The Act requires lenders, mortgage brokers, or servicers of home loans to provide borrowers with pertinent and timely disclosures regarding the nature and costs of the real estate settlement process. The Act also prohibits specific practices, such as kickbacks, and places limitations upon the use of escrow accounts.
The TILA-RESPA rule applies to most closed-end consumer credit transactions secured by real property, but does not apply to: HELOCs; • Reverse mortgages; or • Chattel-dwelling loans, such as loans secured by a mobile home or by a dwelling that is not attached to real property (i.e., land).
The new rules, which would modify RESPA and Regulation X's existing mortgage servicing framework, are designed to streamline the process for obtaining mortgage assistance, and incentivize servicers to prioritize borrower aid over foreclosure.
There are essentially three types of loan covenants: positive loan covenants, negative loan covenants, and financial loan covenants.
Breach of contract – Lenders have long used civil lawsuits to sue borrowers who breached loan agreements. With the rise of lender liability, borrowers now also have a right to sue lenders who breach contractual obligations established in a loan agreement, such as failing to honor a loan commitment.
Financial Covenant Compliance means, as of any date of determination, that the Borrower is in compliance with the Financial Covenant as of the last day of the most recently ended fiscal quarter for which financial statements are required to be delivered pursuant to Sections 5.04(a)(i) or 5.04(a)(ii), in each case ...
RESPA violations include bribes between real estate representatives, inflating costs, the use of shell entities and referrals in exchange for settlement services.
The act requires lenders, mortgage brokers, or servicers of home loans to provide borrowers with pertinent and timely disclosures regarding the nature and costs of the real estate settlement process. The act also prohibits specific practices, such as kickbacks, and places limitations upon the use of escrow accounts.
RESPA, the Real Estate Settlement Procedures Act, prohibits kickbacks. Kickbacks involve giving or receiving something of value in exchange for referrals of settlement services. 2. Reasonable fees paid for services actually performed are not prohibited by RESPA.