OAT Prep Book Secrets 2023-2024 -
Optometry Admission Test [4th Edition]
Exam
Question 1. Which federal law primarily requires lenders to disclose the Annual
Percentage Rate (APR) to consumers?
A) RESPA
B) TILA (Regulation Z)
C) ECOA (Regulation B)
D) HMDA (Regulation C)
Answer: B
Explanation: The Truth in Lending Act (TILA), implemented through Regulation Z,
mandates lenders to disclose the APR to provide consumers with a clear
understanding of the cost of credit, including finance charges and other costs.
Question 2. The purpose of the Right of Rescission under TILA applies to which
types of loans?
A) All mortgage loans
B) Only government-backed loans
C) Certain primary residence refinance transactions
D) Only commercial loans
Answer: C
Explanation: The Right of Rescission under TILA allows borrowers to cancel certain
refinance transactions secured by their primary residence within three days of
closing, providing protection against high-pressure sales.
, OAT Prep Book Secrets 2023-2024 -
Optometry Admission Test [4th Edition]
Exam
Question 3. Which disclosure is provided to borrowers to compare the loan terms
and costs before closing, as mandated by TRID?
A) Loan Estimate
B) Closing Disclosure
C) Appraisal Report
D) Servicing Disclosure Statement
Answer: A
Explanation: The Loan Estimate is provided within three business days of receiving
a loan application and details the estimated costs and terms, helping borrowers
compare options.
Question 4. Under RESPA, which of the following is prohibited?
A) Charging for a title search
B) Paying kickbacks for referrals
C) Disclosing escrow account balances
D) Providing a Loan Estimate
Answer: B
Explanation: RESPA prohibits kickbacks, unearned fees, and referral fees intended
to influence the selection of service providers, promoting transparency and fair
practices.
, OAT Prep Book Secrets 2023-2024 -
Optometry Admission Test [4th Edition]
Exam
Question 5. Which document is used to disclose the final closing costs to the
borrower, typically at settlement?
A) Loan Estimate
B) Closing Disclosure
C) Appraisal Report
D) HUD-1 Settlement Statement
Answer: B
Explanation: The Closing Disclosure provides a detailed account of the final loan
terms and closing costs and must be provided at least three business days before
closing.
Question 6. The TILA-RESPA Integrated Disclosure (TRID) rule combines
disclosures for which purposes?
A) Fair Housing and ECOA
B) TILA and RESPA
C) HMDA and FCRA
D) GLBA and BSA
Answer: B
Explanation: TRID integrates disclosures required by TILA and RESPA to streamline
the loan process, reducing confusion by combining the Loan Estimate and Closing
Disclosure.
, OAT Prep Book Secrets 2023-2024 -
Optometry Admission Test [4th Edition]
Exam
Question 7. Under ECOA, which of the following is a prohibited basis for
discrimination?
A) Income
B) Race
C) Credit score
D) Employment history
Answer: B
Explanation: ECOA prohibits discrimination based on race, color, religion, national
origin, sex, marital status, age, or receipt of public assistance.
Question 8. Which federal regulation requires lenders to notify applicants of
adverse actions taken on their credit applications?
A) TILA
B) ECOA
C) FCRA
D) HMDA
Answer: C
Explanation: The Fair Credit Reporting Act (FCRA) mandates lenders to notify
applicants when adverse actions are based on credit report information, including
reasons for denial.
Optometry Admission Test [4th Edition]
Exam
Question 1. Which federal law primarily requires lenders to disclose the Annual
Percentage Rate (APR) to consumers?
A) RESPA
B) TILA (Regulation Z)
C) ECOA (Regulation B)
D) HMDA (Regulation C)
Answer: B
Explanation: The Truth in Lending Act (TILA), implemented through Regulation Z,
mandates lenders to disclose the APR to provide consumers with a clear
understanding of the cost of credit, including finance charges and other costs.
Question 2. The purpose of the Right of Rescission under TILA applies to which
types of loans?
A) All mortgage loans
B) Only government-backed loans
C) Certain primary residence refinance transactions
D) Only commercial loans
Answer: C
Explanation: The Right of Rescission under TILA allows borrowers to cancel certain
refinance transactions secured by their primary residence within three days of
closing, providing protection against high-pressure sales.
, OAT Prep Book Secrets 2023-2024 -
Optometry Admission Test [4th Edition]
Exam
Question 3. Which disclosure is provided to borrowers to compare the loan terms
and costs before closing, as mandated by TRID?
A) Loan Estimate
B) Closing Disclosure
C) Appraisal Report
D) Servicing Disclosure Statement
Answer: A
Explanation: The Loan Estimate is provided within three business days of receiving
a loan application and details the estimated costs and terms, helping borrowers
compare options.
Question 4. Under RESPA, which of the following is prohibited?
A) Charging for a title search
B) Paying kickbacks for referrals
C) Disclosing escrow account balances
D) Providing a Loan Estimate
Answer: B
Explanation: RESPA prohibits kickbacks, unearned fees, and referral fees intended
to influence the selection of service providers, promoting transparency and fair
practices.
, OAT Prep Book Secrets 2023-2024 -
Optometry Admission Test [4th Edition]
Exam
Question 5. Which document is used to disclose the final closing costs to the
borrower, typically at settlement?
A) Loan Estimate
B) Closing Disclosure
C) Appraisal Report
D) HUD-1 Settlement Statement
Answer: B
Explanation: The Closing Disclosure provides a detailed account of the final loan
terms and closing costs and must be provided at least three business days before
closing.
Question 6. The TILA-RESPA Integrated Disclosure (TRID) rule combines
disclosures for which purposes?
A) Fair Housing and ECOA
B) TILA and RESPA
C) HMDA and FCRA
D) GLBA and BSA
Answer: B
Explanation: TRID integrates disclosures required by TILA and RESPA to streamline
the loan process, reducing confusion by combining the Loan Estimate and Closing
Disclosure.
, OAT Prep Book Secrets 2023-2024 -
Optometry Admission Test [4th Edition]
Exam
Question 7. Under ECOA, which of the following is a prohibited basis for
discrimination?
A) Income
B) Race
C) Credit score
D) Employment history
Answer: B
Explanation: ECOA prohibits discrimination based on race, color, religion, national
origin, sex, marital status, age, or receipt of public assistance.
Question 8. Which federal regulation requires lenders to notify applicants of
adverse actions taken on their credit applications?
A) TILA
B) ECOA
C) FCRA
D) HMDA
Answer: C
Explanation: The Fair Credit Reporting Act (FCRA) mandates lenders to notify
applicants when adverse actions are based on credit report information, including
reasons for denial.
