SAFE Mortgage Loan Originator Test Latest Update Graded A+

SAFE Mortgage Loan Originator Test Latest Update Graded A+ Prequalification an estimate of the loan amt. for which the buyer can qualify based on his income/credit under the lenders standards USDA ratio 29/41 FHA ratio 31/43 Asset based loan -loans based on borrowers equity -bad when lenders fail to consider ability to repay High Cost Loan Reg Z - Sec. 1026.32 -APR will exceed by more than 6.5% for first lien loans or by more than 8.5% for subordinate -APOR - average prime offer rate 1. 5% 2. 6.5% 3. 8.5% RESPA - Section 8 Nothing of value for referrals - No kickbacks Respa - Esign Act can use electronic signature with permission of borrower Gramm Leach Bliley -borrower notification must state who company shares info with -consumers can opt-out of info sharing (send notice to consumer) -Protects from phishing -Safeguard Rules Safeguard Rules -company and staff need to protect the consumers identity -lock up files -part of GLB act second mortgage -All money upfront -no escrow as long as first mortgage is paying it Subordination Clause A contract clause that puts a mortgage in the first lien position over an earlier recorded mortgage Denial Of License -any non-financial felony in the past 7 years -financial felony ever -financial misdemeanor (state decides) -License has been revoked in another state -default on a federal student loan Income -Need to years history and 3 more years expected income -do not include sporadic overtime and bonuses -likelihood of continued income TILA - Respa Integrated Disclosure -TRID -LE must be disclosed within 3 business days -cannot require documentation from borrower without "intent to proceed" -Appraisal is considered 0% tolerance Do Not Call -$16,000 fine -Area code report cant be over 30 days old -allowed to call closed, declined and cancelled loans 18 months after the fact -can call 90 days after inquiry or pre-qual -someone says do not call - cant call, email, fax anything -call between 8-9 Fully Indexed Rate Index rate plus Margin The 1003 Contains all Borrower Info (form) Months of bank statements needed 2 months Patriot Act Part of Bank Secrecy Act -Establish policies for identification of