Prepxl practice test 2: Questions and answers, rated A+| LATEST UPDATE | EXAM PREDICTION QUESTIONS |

Prepxl practice test 2: Questions and answers, rated A+ Under RESPA, the servicer may require a borrower to pay into an escrow account to cover disbursements that are unanticipated or disbursements made before the borrower's monthly payments are available in the account, a cushion or reserve that must be no greater than _____ of the estimated total annual disbursements from the escrow account. - One half - One third - One sixth - One twelfth - -One sixth. Under RESPA, a lender may require the borrower to establish an escrow account at closing. The loan servicer may require a borrower to pay into the account to cover disbursements that are unanticipated or disbursements made before the borrower's monthly payments are available in the account. This is the escrow cushion or reserve, which must be no greater than one sixth of the estimated total annual disbursements from the escrow account. When must a borrower receive notice of whether loan servicing can be assigned, sold, or transferred? - Never - this disclosure is not required - Within 30 days of the transfer of servicing - Within 15 days of the transfer of servicing - Either at the time of application or within three business days of application - -Either at the time of application or within three business days of application. A mortgage servicing disclosure statement discloses whether the servicing of the loan (i.e., collection of payments) may be assigned, sold, or transferred to any other person at any time while the loan is outstanding. It must be delivered to the borrower at application or within three business days. Each of the following is true about the Department of Housing and Urban Development (HUD), except: - The Federal Housing Administration, with its liberal-eligibility FHA loan programs, operates under HUD's authority - It provides or makes referrals related to housing counseling for loan applicants seeking a HECM or high-cost home loan - Public housing and multi-family housing fall under its purview - It has a major role in overseeing the mortgage industry - -It has a major role in overseeing the mortgage industry. Although the federal Department of Housing and Urban Development (HUD) no longer oversees the mortgage industry (that job has been taken over by the Consumer Financial Protection Bureau, or CFPB), it continues to operate in a number of important areas relating to housing. These areas include programs related to community planning and development, public housing and multi-family housing, and providing counseling for those seeking to purchase a home. The Federal Housing Administration (FHA) also operates under HUD; the FHA sponsors loan programs with relatively liberal qualification requirements, insuring financial institutions that offer loans to individuals who might not qualify for a prime loan. Finance charges that are withheld from the proceeds of the loan are considered to be: - P.O.C. charges - Third-party fees - Prepaid finance charges - Periodic interest charges - -Prepaid finance charges. A prepaid finance charge (PFC) is any finance charge paid separately, in cash or by check, before or at consummation of a transaction or withheld from the proceeds of the loan at any time. They are direct loan charges paid by the borrower (not a third party) that must be included in computing the annual percentage rate. What two main aspects of a loan application does an underwriter examine to determine if lender guidelines are being met? - Applicant and collateral - Applicant and credit - Credit and income -Credit and collateral - -Applicant and collate