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PITI
- Principal - Interest - Taxes - Insurance
- - In at least 10% of the down payment
- 1) PITI
- - no more than 28% of the gross monthly income
- 2) PITI + other (non-housing) debt expense
- - not to exceed 36% of the gross monthly income
- 3) Other (non-housing) debt
- - not to exceed 8% of the gross monthly income
- 4) Insurance premiums, utilities, routine medical care
- - to be covered by 64% of the gross monthly income
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In at least 10% of the down payment PITI must be
- no more than 28% of the gross monthly income
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In at least 10% of the down payment PITI + other (non-housing) debt expense must be
- not to exceed 36% of the gross monthly income
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In at least 10% of the down payment other (non-housing) debt must
- not to exceed 8% of the gross monthly income
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In at least 10% of the down payment insurance premiums, utilities, routine medical care must
- be covered by 64% of the gross monthly income
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Conventional loan
- is not government insured or guaranteed
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Conventional loan if down payment 20%+
no additional insurance
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Conventional loan (PITI?)
- - PITI must be no more than 28% of the gross monthly income
- - PITI + other (non-housing) debt expense not to exceed 36% of the gross monthly income
- - Maximum total monthly obligation can be as high as 45%-50%
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PMI
- Private Mortgage Insurance
- - required by FHFA if down payment less than 20%
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PMI Covers fixed-rate loans for how long?
- 10 to 30 years
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PMI allows low down payment how low?
- 3.5% of the purchase price
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Buyers pays PMI when and for how long?
- buyer pays 1 year's PMI at closing
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MIP
- Mortgage Insurance Premium
- - required for borrower of FHA loan
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FSA
- Farm Service Agency
- - Federal agency of the Department of Agriculture
- - provides Agricultural Loan Program
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CRV
- Certificate of Reasonable Value
- - issued by VA and states the property's current market value based on a VA-approved appraisal
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TILA
- Truth in Lending Act
- - requires that Credit Institution inform borrowers of the true cost of credit
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TILA penalties
- - x2 the amount of the finance charge
- - min of $100
- - max of $1,000
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Tila-Respa Integrated Disclosure Rule
- 1) Loan Estimate must be provided w/i 3 business days after a loan application is submitted
- 2) Closing Disclosure
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With in how many days Loan Estimate must be provided per Tila-Respa Integrated Disclosure Rule
Loan Estimate must be provided w/i 3 business days after a loan application is submitted
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ECOA
- Equal Credit Opportunity Act
- - race, religion...
- - what you do for one, do for all
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FCRA
- Fair Credit Reporting Act
- - requires that a creditor truthfully record credit remarks on an individual's credit report
- - law applicant who is rejected must be provided with statement of the reason w/i 30 days
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CRA
- Community Reinvestment Act
- - responsibility of Financial Institutions to help meet their communities’ needs
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RESPA
- Real Estate Settlement Procedure Act
- - requirements apply when property is financed with a federally-related mortgage loan
- - includes all government financed loans
- - FHA, VA, Fannie Mae, Ginnie Mae, or Freddie Mac
- - buyer and the seller fully informed of all costs related to closing the transaction
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RESPA includes
- all government financed loans
- - FHA, VA, Fannie Mae, Ginnie Mae, or Freddie Mac
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RESPA apply to
- First-lien Residential Mortgage Loan to 1 to 4 family home, cooperative or condominium - Second or subordinate liens for Home Equity Loans
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RESPA does not apply to
- 1) more than 25 acres
- 2) business or agricultural
- 3) construction loans
- 4) vacant land
- 5) Installment Contract (contract for deed)
- 6) buyer's assumption
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CLO
- Computerized Loan Organization System
- - to earn to 1/2 point of the loan amount
- - for providing a borrower access to a lender available throws a brokerage
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AIR
Appraiser Independence Requirements
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FIRREA
- Financial Institution Reform Recovery and Enforcement Act
- - any appraisal be performed by competent individual who is licensed
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AQB
- Appraiser Qualifications Board
- - confirms
- - State Licensing
- - Certification Criteria for appraisers
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APB
- Appraisal Practice Board
- - offers voluntary guidance to appraisers
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ASB
Appraisal of Standards Board
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USPAP
- Uniform Standards of Professional Appraisal Practice
- - book established by ASB
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URAR
- Uniform Residential Appraisal Report
- - illustrates the type of detail information required of an appraisal
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Section 9
- prohibits home seller from requiring buyer to purchase Title Insurance from a practical company
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Section 10
- prohibits the lender from requiring excessive escrow deposits for taxes and Hazard insurance
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ABA
- Affiliated Business Arrangement
- - package of service to consumers
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CAM
- Community Association Management
- - mostly for commercials (snow, landscaping…)
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BRI
- Building Related Illness
- - asthma, hypersensitivities, allergies
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SBS
- Sick Building Syndrome
- - fatigue, nausea dizziness, headache
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EPA
Environmental Protection Agency
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EPA require that residential dwelling built before 1978
- 1) LL and sellers must disclose known information
- 2) All are required to disclose any prior test results
- 3) Buyers must have up to 10 days to conduct a risk assessment or inspection
- 4) “Protect Your Family from Lead in Your Home” the pamphlet
- 5) Anyone who disturbs paint in housing built before 1978 must be trained and certified
- 6) REP must ensure that all parties comply with the law
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RR&P
- Renovation, Repair and Painting Program
- - involves prerenovation education
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VOC
- Volatile (во’латил - летучий) Organic Compounds
- - Formaldehyde - can be measured
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PCBs
- Polychlorinated Biphenyls (поли-кло’ринэйтэд ба’йфэнилс)
- - consists of more than 200 chemical compounds
- - used in transformers, electrical motors, refrigerators
- - can be destroyed only burning at more than 2,400 degrees
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CFCs
- Chlorofluorocarbons (клоро-флуро-карбонс)
- - non-toxic nonflammable chemical
- - used as refrigerant in air conditioners, refrigerators and freezers (destroys Ozone layer)
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USTs
Underground storage tanks
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CERCLA
- Comprehensive Environmental Response, Compensation, and Liability Act
- - to clean up uncontrolled hazardous waste sites
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SARA
- Superfund Amendment and Rasterization Act
- - (rasterize (ра’стэрайзэйшон) – third person present)
- - created an "innocent land owner" immunity status
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ESA
- Environmental Site Assessments
- - Phase 1 - to determine whether any potential environmental problems exist
- - Phase 2 - includes soil water and other testing and is performed if warranted
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EIS
- Environmental Impact Statements
- - details impact the Federally Funded Project (required) will have on the environment
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