NAFCU NCCO TEST 4 Exam UPDATED
QUESTIONS AND CORRECT ANSWERS
How long do mortgage servicers have to make contact with delinquent members -
CORRECT ANSWER Live contact: establish or make a good faith effort to establish
live contact by the 36th day of delinquency
written notice: provide written notice of loss mitigation options by the 45th day of
delinquency
What are the requirements for Credit unions to use coupon books intead of periodic
statements. - CORRECT ANSWER Only applied to Fixed mortgages
require to have ammount due, amount of any late fees, the date late fees are charged, the due
date
Are there any types of loans exempt from periodic statement requirements? If so what types
of loans are exempt? - CORRECT ANSWER Reverse mortgages, HELOC, timeshare
loans, and small services
What is the timing of the notice requirements for force-placed insurance? - CORRECT
ANSWER First notice - send at least 45 days before charging the member
reminder notice - sent 30 days before the first notice
renewal notice - sent 45 days before renewal
When is a credit union considered a "small servicer"?
What are some of the provisions that would still apply to "small servicers"? What are some
provions that do not apply to "small servicers" - CORRECT ANSWER A servicer that,
together with any affiliates, services 5,000 or fewer mortgage loans and the servicers it eh
creditor or assignee for all of them.
Not exempt from ARM notices, prompt crediting of payments, responding to QWRs, escrow
account servicing requirements
, Extempt from general servicing procedures and requirements, periodic statements,
prohibition on purchasing force placed insurance, majority of rules for servicing delinquent
mortgages
What is an error for the purposes of the error resolution rule? - CORRECT
ANSWER No exact defintion
but regulation provides example such as
- failure to accept a conforming payment
- failure to apply payment
- not related orgination or underwriting
What is the difference between information request and an error notice? - CORRECT
ANSWER Information request does not require notice of error.
What is a periodic payment? How much servicers handle these payments? - CORRECT
ANSWER Include the amount neccesary to pay principal interest and any applicable
escrow
must credit the day they are recieved
How are partial payments treated?
Can CUs charge a late payment fee for a partial payment? - CORRECT ANSWER CU
may credit the payment, return the payment, place in a suspense account until the funds are
sufficient to cover the periodic payment
can cause the payment to be late
What consitutes prohibited pyramiding of late fees? - CORRECT ANSWER Occurs
when the member incurs a late fee, but does immediately pay the late fee, and the service
applies a subsequent payment to the late fee first, making the next payment a partial payment,
and incurring yet another late fee.
QUESTIONS AND CORRECT ANSWERS
How long do mortgage servicers have to make contact with delinquent members -
CORRECT ANSWER Live contact: establish or make a good faith effort to establish
live contact by the 36th day of delinquency
written notice: provide written notice of loss mitigation options by the 45th day of
delinquency
What are the requirements for Credit unions to use coupon books intead of periodic
statements. - CORRECT ANSWER Only applied to Fixed mortgages
require to have ammount due, amount of any late fees, the date late fees are charged, the due
date
Are there any types of loans exempt from periodic statement requirements? If so what types
of loans are exempt? - CORRECT ANSWER Reverse mortgages, HELOC, timeshare
loans, and small services
What is the timing of the notice requirements for force-placed insurance? - CORRECT
ANSWER First notice - send at least 45 days before charging the member
reminder notice - sent 30 days before the first notice
renewal notice - sent 45 days before renewal
When is a credit union considered a "small servicer"?
What are some of the provisions that would still apply to "small servicers"? What are some
provions that do not apply to "small servicers" - CORRECT ANSWER A servicer that,
together with any affiliates, services 5,000 or fewer mortgage loans and the servicers it eh
creditor or assignee for all of them.
Not exempt from ARM notices, prompt crediting of payments, responding to QWRs, escrow
account servicing requirements
, Extempt from general servicing procedures and requirements, periodic statements,
prohibition on purchasing force placed insurance, majority of rules for servicing delinquent
mortgages
What is an error for the purposes of the error resolution rule? - CORRECT
ANSWER No exact defintion
but regulation provides example such as
- failure to accept a conforming payment
- failure to apply payment
- not related orgination or underwriting
What is the difference between information request and an error notice? - CORRECT
ANSWER Information request does not require notice of error.
What is a periodic payment? How much servicers handle these payments? - CORRECT
ANSWER Include the amount neccesary to pay principal interest and any applicable
escrow
must credit the day they are recieved
How are partial payments treated?
Can CUs charge a late payment fee for a partial payment? - CORRECT ANSWER CU
may credit the payment, return the payment, place in a suspense account until the funds are
sufficient to cover the periodic payment
can cause the payment to be late
What consitutes prohibited pyramiding of late fees? - CORRECT ANSWER Occurs
when the member incurs a late fee, but does immediately pay the late fee, and the service
applies a subsequent payment to the late fee first, making the next payment a partial payment,
and incurring yet another late fee.
