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List five of the HUD rights for borrowers. (Additional correct answers are found on page #3.)
Right to shop for the best loan and compare charges
Right to be informed about the total cost of the loan
Right to an estimate of all loan and settlement charges before agreeing to the loan
Right to know what fees are not refundable if borrower cancels the loan
Right to know how much the mortgage broker is being paid by borrower and by lender
List five of the HUD rights for borrowers. (Additional correct answers are found on page #3.)
- Right to shop for the best loan and compare charges
- Right to be informed about the total cost of the loan
- Right to an estimate of all loan and settlement charges before agreeing to the loan
- Right to know what fees are not refundable if borrower cancels the loan
- Right to know how much the mortgage broker is being paid by borrower and by lender
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List five of the MBA rights for borrowers that are different or in addition to the rights provided by HUD. (Additional correct answers are found on page #4.)
- Right not to be subject to deceptive marketing tactics
- Right to receive credit counseling prior to loan closing
- Right to decline credit insurance
- Right to fair and equitable resolution to disputes related to the loan
- Right to have favorable information reported to credit reporting agencies on a timely basis
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Does a borrower have any rights to object to and stop an assignment of his loan for servicing? Why or why not?
This depends entirely on the written agreement between the borrower and the lender. If the agreement does not prevent the lender from selling the loan and its servicing rights, the borrower has no rights to stop the assignment. If the agreement states the lender will not assign the loan and its servicing, then the borrower can object and bring legal action to stop the assignment.
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What is required under Regulation Z and to what loans does this regulation NOT apply?
Reg Z requires lenders to disclose to buyers the true cost of obtaining credit so the borrowers can compare the costs of various lenders. It does not apply to commercial loans or agricultural loans over $25,000.
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Briefly explain the Right to Rescind.
The borrower has the right to cancel a credit or loan transaction by notifying the lender within 3 days. This right does not apply to residential first mortgage loans.
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List five borrower rights under ECOA. (Additional correct answers are found on page #13.)
- Right to apply for credit regardless of sex, marital status, age, race, national origin, or receipt of public assistance income
- Right not to reveal plans for having or raising children
- Right not to reveal if applicant is widowed or divorced
- Right not to reveal sex, race, national origin, or religion.
- Right not to reveal marital status if applying for a separate, unsecured account
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List three lender rights under a loan agreement. (Any three of the following.)
- To receive payment of the debt in accordance with the terms of the note
- To require the borrower pay all real estate taxes on the property given as security
- To require the borrower maintain adequate insurance
- To require the borrower to maintain the property in good repair at all times
- To require the borrower to obtain lender authorization prior to making any major alterations to the property
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What right does the lender have if a borrower defaults or stops making payments on a mortgage loan and how does this impact the borrower?
The lender has the right to use the legal process of foreclosure which terminates the rights and title of the borrower.
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What are the two types of foreclosures?
Judicial and non-judicial
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Since Indiana is a lien theory state and does not include a power of sale provision in its Code, how does this impact lenders who wish to foreclose on a property?
Lenders have the right to foreclose only by using the judicial foreclosure process.
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What does a lis pendens do?
It gives public notice that the property may soon have a judgment against it and enables other lienholders to join in the suit.
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What is the difference between equitable right of redemption and statutory right of redemption? Which is not allowed in Indiana?
- Equitable right of redemption gives the borrower the right to clear the debt prior to the foreclosure sale.
- Statutory right of redemption gives the borrower the right to clear the debt within a certain amount of time after the sale.
- Indiana has no statutory right of redemption.
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What has Indiana done that impacts a seller's right of forfeiture if the buyer defaults in a land contract?
Indiana reformed its laws for cases where the buyer has significant equity in the property to require a seller to institute formal foreclosure procedures and compensate the buyer for accumulated equity before repossessing the property.
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___identifies ten rights for borrowers regarding loans and credit.
HUD
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_____Bankers Association provides eleven rights for borrowers that do not have the weight of the law behind them but do represent MBA policy. These rights are in regard to loans and credit and honest marketing.
Mortgage
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Mortgage____ are responsible for collecting payments from mortgage borrowers on behalf of loan owners.
servicers
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The Consumer Finance Protection Bureau amended Regulation__ to include specific requirements for mortgage loan servicers.
X
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The Truth in Lending Act, Title I of the Consumer Credit Protection Act, implemented by Regulation__, requires lenders to disclose to buyers the true cost of obtaining credit, so that borrowers can compare the costs of various lenders.
Z
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Regulation Z applies to all loans that are secured by a residence, but not commercial loans or agricultural loans over $___
$25,000.
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Right to Rescind – In most cases, the borrower has a right to cancel the transaction by notifying the lender within _ days. This does not apply to residential first mortgage loans but does apply to refinancing and home equity loans.
3
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Equal Credit Opportunity Act provides several rights for borrowers in regard to_____
applying for credit.
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Lender's rights are provided for under___ ___ ___, including receiving payments on the debt and requirements the lender can make of the borrower.
loan contract provisions
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The federal Garn-St. Germain Depository Institutions Act of 1982 governs due-on-sale clauses in loans and preempts all state statutes and judicial decisions that restrict enforcement of___ __ ___ clauses.
due-on-sale
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Non-judicial and judicial are the two types of foreclosures. Indiana only allows______, which require judicial review before a lender can foreclose.
judicial foreclosures
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Under non-judicial foreclosures, borrowers in default are given notice of default and, if default is not cured, the lender has the right to sell the property at public auction. The proceeds from the sale go towards paying off the loan and other liens. If the proceeds are not enough to cover the debt, the lender has the right to file_____ suit against the borrower.
deficiency
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Under judicial foreclosures, borrowers in default are given notice and, if default is not cured, the lender has the right to accelerate the loan or declare the loan balance is due and payable immediately. The lender then has the right to file foreclosure suit, which includes a__ ____ public notice and writ of execution for the sheriff to seize and sell the property.
lis pendens
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Equitable Right of Redemption –
The borrower has the right to clear the debt prior to foreclosure sale and have loan reinstated.
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The Statutory Right of Redemption –
The borrower has the right to clear the debt within a certain amount of time after the sale.
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There is no redemption right in_____ foreclosure.
non- judicial
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There (is or is no) Statutory Right of Redemption in Indiana.
Is no
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an alternative home financing method that allows a buyer to bypass the bank approval process and work directly with the seller, who acts as the lender and keeps the deed as collateral.
Land contracts –
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Indiana law permits land contract sellers the right of forfeiture provided the right is expressly stated in the ____ ____
sale contract
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Indiana has reformed its laws to remedy the situation where a buyer defaults after completing many payments. If the buyer's equity in the property at the time of default is "______," as defined by the law, the seller must institute formal foreclosure procedures and must compensate the buyer for accumulated equity before repossessing the property.
significant
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There are two situations in which a forfeiture is appropriate in Indiana:
- where there is an abandoning, absconding buyer
- where the buyer has paid a minimal amount on the contract at the time of default and seeks to retain possession while the seller is paying taxes, insurance, and other upkeep in order to preserve the premises
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_______foreclosure is another option for Indiana sellers in land contracts.
Judicial
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The amendment to Regulation X did NOT require loan servicers to
assign the loan to a new servicer in response to a borrower's complaints.
evaluate borrowers’ applications for available loss mitigation options.
provide certain information requested by such borrowers
provide protections to such borrowers in connection with force-placed insurance
assign the loan to a new servicer in response to a borrower's complaints.
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Lis pendens means
the Sheriff is given authority to seize and sell the foreclosed property.
public notice is given that the property may soon have a judgment issued against it.
lienholders can foreclose on the property.
the lender can file a suit of deficiency.
public notice is given that the property may soon have a judgment issued against it.
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The right that applies to refinancing and home equity home loans but does not apply to first residential mortgages is called
disclosure.
right to rescind.
Equitable Redemption.
Statutory Redemption.
right to rescind.
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The right to have a lender consider a borrower's ability to repay the loan before credit is extended is provided by
ECOA.
MBA Borrower's Bill of Rights.
HUD's rights for borrowers.
Regulation X.
MBA Borrower's Bill of Rights.
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The right to rescind allows borrowers to cancel the transaction by
returning the contract to the lender.
notifying the mortgage broker within 5 days.
notifying the lender within 3 days.
contacting the credit agencies.
notifying the lender within 3 days.
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President Obama introduced a mortgage servicing bill of rights for borrowers in response to what?
The amendment of Regulation X
Violations of the ECOA
Robo-signing practices
A request by the Consumer Finance Protection Bureau
Robo-signing practices
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A borrower's right not to reveal his/her religion is provided by
Regulation Z.
ECOA.
contract provisions.
Regulation X.
ECOA.
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Which regulation requires lenders to disclose to buyers the true cost of obtaining credit so borrowers can compare various lenders?
Regulation X
Regulation Z
Dodd-Frank Act
Consumer Protection Act
Regulation Z
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Which of the following does NOT provide rights to either borrowers or lenders in mortgage loans?
HUD
MBA
ADA
ECOA
ADA
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Which of the following is NOT a right included in those provided by HUD?
RIGHT to be informed about the total cost of your loan including the interest rate, points and other fees.
RIGHT to know what fees are not refundable if you decide to cancel the loan agreement.
RIGHT to request and receive background check on the mortgage broker.
RIGHT to ask questions about charges and loan terms that you do not understand.
RIGHT to request and receive background check on the mortgage broker.
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Indiana does not allow
statutory right of redemption.
forfeiture.
judicial foreclosure.
equitable right of redemption.
statutory right of redemption.
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The right to be informed of the reason a loan or credit was denied is provided by both
ECOA and HUD.
HUD and MBA.
MBA and Regulation Z.
ECOA and MBA.
ECOA and HUD.
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Which of the following is a type of foreclosure recognized in Indiana?
Judicial
Non-judicial
Forfeiture
Automatic
Judicial
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What provides the right to shop for the best loan and compare charges of different mortgage brokers and lenders?
MBA
ECOA
HUD
Regulation X
HUD
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Which regulation requires lenders to disclose to buyers the true cost of obtaining credit so borrowers can compare various lenders?
Regulation X
Regulation Z
Dodd-Frank Act
Consumer Protection Act
Regulation Z
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In a loan agreement, the lender does NOT have the right to
receive payment of the debt.
require the borrower to pay real estate taxes on the property.
require the borrower obtain credit insurance.
require the borrower to maintain adequate insurance.
require the borrower obtain credit insurance.
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What regulation requires mortgage loan servicers to provide protections to borrowers in connection with force-placed insurance?
Regulation X
Regulation Z
Dodd-Frank Act
Consumer Protection Act
Regulation X
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The provisions of Regulation Z cover
credit reports.
disclosure of defects.
lis pendens.
right to rescind.
right to rescind.
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