What does TILA stand for? - ANSWER Truth-In-Lending Act, Regulation Z
What is a HELOC loan? - ANSWER a secured loan in that you are borrowing against the
equity that has been built in your house
What is a REFI loan? - ANSWER
LTV stands for - ANSWER Loan to Value
Define PMI and state what the acronym stands for. - ANSWER Private mortgage insur-
ance- on conventional loans
Define one time variable funding fee and people in what situations is it waived for? - AN-
SWER Disabled veterans and surviving spouses.
USDA loans are also called what? - ANSWER 502 loans
Define MIP - ANSWER Can be paid up front or in installments. Mortgage insurance
premium used by FHA to protect themselves against higher-risk borrowers who are more
likely to default on loans
Define APR - ANSWER annual percentage rate
Define APOR - ANSWER average prime offer rate
1
,Define HPML - ANSWER High price mortgage loans or Section 35 loans. A mortgage
with an annual percentage rate (APR) that's higher than the average prime offer rate (APOR)
When is a loan considered to be a section 35 loan? (High price mortgage loan) - AN-
SWER - When the APR exceeds APOR by 1.5% on a first lien, 2.5% on Jumbo first lien
or 3.5% on subordinate lien
What requirements are placed on section 35 loans? (High price mortgage loans) - AN-
SWER APE
A- ATR / ability to repay
P- no PREPAYMENT penalty unless in the first 2 years
E- requires ESCROW of the taxes and hazard insurance for the first 5 years
Define ATR - ANSWER Ability to repay
8 Factors of ATR - ANSWER MICE DOES
M- Monthly mortgage
I- Income + assets
C- Credit history
E- Employment
D- Debt to Income Ratio
O- Other debts
E- Expenses
S- Simultaneous mortgage
What are section 32 loans? - ANSWER High cost mortgage loans. Considered to be
HCML when APR exceeds APOR by 6.5% on first lien on loan $50,000 or higher, or 8.5% on
first lien on a loan that's less than $50,000 or 8.5% on subordinate lien.
2
, What requirements are placed on Section 32 loans / HCML / High cost mortgage loans? -
ANSWER BAPS
B- no BALLOON payment
A- must have ATR
P- no PREPAYMENT PENALTY
S- must SPEAK to a HUD counselor
What makes a complete application? - ANSWER ALIENS
A- Address
L- Loan amount
I- Income
E- Estimated value
N- Name
S- Social security number
What is a 1003 and a 1004 form? - ANSWER URLA - Uniform Residential Loan Applica-
tion
and
URAR - Uniform Residential Appraisal Report
What is a 1005 and 1006 form? - ANSWER VOE - Verification of employment
and
VOD - Verification of deposits (bank balance)
What is a 1008 form? - ANSWER Transmittal summary. Top sheet! SUMMARY
What are the protected classes under ECOA AND Fair Housing Act? - ANSWER - Sex
3
What is a HELOC loan? - ANSWER a secured loan in that you are borrowing against the
equity that has been built in your house
What is a REFI loan? - ANSWER
LTV stands for - ANSWER Loan to Value
Define PMI and state what the acronym stands for. - ANSWER Private mortgage insur-
ance- on conventional loans
Define one time variable funding fee and people in what situations is it waived for? - AN-
SWER Disabled veterans and surviving spouses.
USDA loans are also called what? - ANSWER 502 loans
Define MIP - ANSWER Can be paid up front or in installments. Mortgage insurance
premium used by FHA to protect themselves against higher-risk borrowers who are more
likely to default on loans
Define APR - ANSWER annual percentage rate
Define APOR - ANSWER average prime offer rate
1
,Define HPML - ANSWER High price mortgage loans or Section 35 loans. A mortgage
with an annual percentage rate (APR) that's higher than the average prime offer rate (APOR)
When is a loan considered to be a section 35 loan? (High price mortgage loan) - AN-
SWER - When the APR exceeds APOR by 1.5% on a first lien, 2.5% on Jumbo first lien
or 3.5% on subordinate lien
What requirements are placed on section 35 loans? (High price mortgage loans) - AN-
SWER APE
A- ATR / ability to repay
P- no PREPAYMENT penalty unless in the first 2 years
E- requires ESCROW of the taxes and hazard insurance for the first 5 years
Define ATR - ANSWER Ability to repay
8 Factors of ATR - ANSWER MICE DOES
M- Monthly mortgage
I- Income + assets
C- Credit history
E- Employment
D- Debt to Income Ratio
O- Other debts
E- Expenses
S- Simultaneous mortgage
What are section 32 loans? - ANSWER High cost mortgage loans. Considered to be
HCML when APR exceeds APOR by 6.5% on first lien on loan $50,000 or higher, or 8.5% on
first lien on a loan that's less than $50,000 or 8.5% on subordinate lien.
2
, What requirements are placed on Section 32 loans / HCML / High cost mortgage loans? -
ANSWER BAPS
B- no BALLOON payment
A- must have ATR
P- no PREPAYMENT PENALTY
S- must SPEAK to a HUD counselor
What makes a complete application? - ANSWER ALIENS
A- Address
L- Loan amount
I- Income
E- Estimated value
N- Name
S- Social security number
What is a 1003 and a 1004 form? - ANSWER URLA - Uniform Residential Loan Applica-
tion
and
URAR - Uniform Residential Appraisal Report
What is a 1005 and 1006 form? - ANSWER VOE - Verification of employment
and
VOD - Verification of deposits (bank balance)
What is a 1008 form? - ANSWER Transmittal summary. Top sheet! SUMMARY
What are the protected classes under ECOA AND Fair Housing Act? - ANSWER - Sex
3
