HUD Certification Exam 2023 Questions and Answers

Federal law requiring lenders to not discriminate in lending practices. - Answer- Equal Credit Opportunities Act (ECOA) A lender denies a loan to an immigrant family due to not having lived in the US for 5+ Years - Answer- Ecoa What agencies woyld you report ECOA Violations to? - Answer- Federal Trade Commission (FTC) Law that regulated disclosures that lenders must provide and states that sellers cannot require buyers to obtain insurance from specific sources - Answer- Real Estate Settlement Procedures Act RESPA(Regulation X) A home seller's cousin owns a title insurance company and gives a kickback for referrals. The seller makes it a sale requirement for the buyer to buy insurance from that insurance company. - Answer- RESPA Violation RESPA violations are filed with what agency? - Answer- Consumer Financial Protection Bureau (CFPB) Requires lenders to provide terms of a loan to a consumer before application for comparison shopping. - Answer- Truth In Lending Act (TILA) A consumer submitted a loan application and the interest rate he was given after his application was different from that which was provided before the application process. - Answer- Truth In Lending Act (TILA) violation TILA Violations should be reported to what government Agency? - Answer- Federal Trade Commission(FTC) An amendment to TILA which requires lenders to determin the ability for a consumer to repay the loan. - Answer- Ability To Repay/Qualified Mortgage (ATR/QM) Rule Amendment to both TILA & RESPA that dictates that term disclosure forms must be clear to understand. - Answer- TILA-RESPA Integrated Disclosure(TRID) Client receives a closing disclosure 3 days before closing and 2 days later receives an updated disclosure with no change in the closing date. - Answer- TRID Violation TRID Violations are filed with: - Answer- Consumer Financial Protection Bureau Federal law that covers HELOCS and high cost mortgages and refinances. Also requires disclosures be provided a minimum of 3 days befor a loan closing. - Answer- Home ownership and Equity Protection Act (HOEPA) a consumer was aproved for an Adjustable rate loan and three months later her loan payment became astoundingly high. the consumer was aware that her payment amount could change but was unaware by how much. - Answer- HOEPA Violation what law regulates the access to consumer credit reports by third Partied? - Answer- Fair Credit Reporting Act(FCRA) What law requires reporting agencies to provide an annual free credit report to consumers? - Answer- Fair and Accurate Credit Transactions Act (FACTA) What law allows for a consumer to put a fraud alert on a credit report as to pervent identity theft. - Answer- Fair and Accurate Credit Transactions Act (FACTA) What law requires the Truncation of Credit card numbers on a receipt? - Answer- Fair and Accurate Credit Transactions Act (FACTA) Tp what agency do you report all FCBA, FRA, FACTA Violations? - Answer- CFPB wjat law allows for the dispute of items on a credit report and requires investigation of any Disputed items. - Answer- Fair Credit Billing Act(FCBA) In what year did Dr. Martin Luther King Jr. die? - Answer- 1968 What Supreme court case created the idea of separate but equal is okay? - Answer- Plessy V. Ferguson What Supreme court case reversed to findings of Seperate but equal? - Answer- Brown V. Board What 2 documents must a self employed person submit for calculating there Adjusteds Gross income? - Answer- 2 years Tax returns, Year to Date P&L What is the Maximum up front Ratio that is allowable under a FHA Loan? - Answer- 31% What is the Maximum up front Ratio that is allowable under a conventional Loan? - Answer- 28% what is the advised Rent to income ratio? - Answer- 30% what are the back end ratios traditionally for a Conventional loan? - Answer- 36% What are the Max Back end ratios for a conventional loan? - Answer- 45 or even 50% What is the Back End Ratio for a traditional FHA loan? - Answer- 43% What is the Back End Ratio for a FHA(EEM) Loan? - Answer- 45% What are the 4 C's of credit? - Answer- Character/ Credit History, Capital, Capacity and collateral.