NMLS LAWS AND REGULATIONS
Questions and Answers
1.CFPB
Answer Consumer Financial Protection Bureau
2.What does the CFPB do?
Answer Regulates RESPA, TILA, ECOA, and HMDA
3.FTC
Answer Federal Trade Commission
4.What does the FTC do?
Answer Monitors Red Flag Rules
5.RESPA
Answer Real Estate Settlement Procedures Act
6.What does RESPA do?
Answer •Protects homeowners of Single, 1-4 family dwellings, condos,
& homes manufactured on lot.
• Educates borrowers costs of loan
• Eliminates kickbacks and referral fees (section 8)
• Establishes rules for escrow
,7.What Regulation is RESPA?
Answer Reg X (X-ray of my RESPAtory system)
8.Who oversees RESPA?
Answer (CFPB) Consumer Financial Protection Bureau
9.How long must records be kept under RESPA?
Answer 5 years (RESPA has 5 letters= 5 letters of
record keeping)
10.What are the penalties for violating RESPA?
Answer $10k, 1 yr in prison OR both (5 years x 2= $10,000 fine)
11.TILA
Answer Truth in Lending Act
12.What does TILA do?
Answer • part of the Federal Consumer Protection Act and lays out
disclosure requirements, advertising
requirements as well as rights of rescission and penalties for violation.
• Requires creditors to disclose certain key terms and costs of the
transaction
13.What Regulation is TILA?
,Answer Reg Z (Today I learned about Zebras. They cost 5k for the first 3
years of life)
14.Who oversees TILA?
Answer •Consumer Financial Protection Bureau (CFPB), •Adver- tising
Federal Trade Commission (FTC)
15.How long must records be kept under TILA?
Answer 3 Years
(Today I learned about Zebras. They cost 5k for the first 3 years of life)
16.What are the penalties for violating TILA?
Answer $5k, 1 year Prison or both
$500k for class action suits or 1% if net worth of servicer,
whichever is less (Today I learned about Zebras. They cost $5k
for the first 3 years of life)
17.ECOA
Answer Equal Credit Opportunity Act
18.What does ECOA do?
Answer • Keeps lenders form discriminating for age, race, religion,
sex, marital status, color, national origin, income from government,
or exercising rights under CCPA
• Promotes the availability of credit to all applicants
, • Requires notice of adverse action within 30 days
• Handicap is NOT protected by this law (See Fair Housing Lending Laws)
19.What regulation is ECOA?
Answer Reg B (Be Equal)
20.Who oversees ECOA?
Answer Consumer Financial Protection Bureau (CFPB)
21.How long must records be kept under the ECOA?
Answer 25 Months (25 letters in "Equal Credit Opportunity Act)
22.What are the penalties for violating ECOA?
Answer $10k individual fine
$500,000 Class Action Lawsuit
23.HMDA
Answer Home Mortgage Disclosure Act
24.What does HMDA do?
Answer • Provides Data to public, assists public officials, and identifies
evidence of descrimination
• Stops Redlining
(Government monitoring section 10 of 1003
Questions and Answers
1.CFPB
Answer Consumer Financial Protection Bureau
2.What does the CFPB do?
Answer Regulates RESPA, TILA, ECOA, and HMDA
3.FTC
Answer Federal Trade Commission
4.What does the FTC do?
Answer Monitors Red Flag Rules
5.RESPA
Answer Real Estate Settlement Procedures Act
6.What does RESPA do?
Answer •Protects homeowners of Single, 1-4 family dwellings, condos,
& homes manufactured on lot.
• Educates borrowers costs of loan
• Eliminates kickbacks and referral fees (section 8)
• Establishes rules for escrow
,7.What Regulation is RESPA?
Answer Reg X (X-ray of my RESPAtory system)
8.Who oversees RESPA?
Answer (CFPB) Consumer Financial Protection Bureau
9.How long must records be kept under RESPA?
Answer 5 years (RESPA has 5 letters= 5 letters of
record keeping)
10.What are the penalties for violating RESPA?
Answer $10k, 1 yr in prison OR both (5 years x 2= $10,000 fine)
11.TILA
Answer Truth in Lending Act
12.What does TILA do?
Answer • part of the Federal Consumer Protection Act and lays out
disclosure requirements, advertising
requirements as well as rights of rescission and penalties for violation.
• Requires creditors to disclose certain key terms and costs of the
transaction
13.What Regulation is TILA?
,Answer Reg Z (Today I learned about Zebras. They cost 5k for the first 3
years of life)
14.Who oversees TILA?
Answer •Consumer Financial Protection Bureau (CFPB), •Adver- tising
Federal Trade Commission (FTC)
15.How long must records be kept under TILA?
Answer 3 Years
(Today I learned about Zebras. They cost 5k for the first 3 years of life)
16.What are the penalties for violating TILA?
Answer $5k, 1 year Prison or both
$500k for class action suits or 1% if net worth of servicer,
whichever is less (Today I learned about Zebras. They cost $5k
for the first 3 years of life)
17.ECOA
Answer Equal Credit Opportunity Act
18.What does ECOA do?
Answer • Keeps lenders form discriminating for age, race, religion,
sex, marital status, color, national origin, income from government,
or exercising rights under CCPA
• Promotes the availability of credit to all applicants
, • Requires notice of adverse action within 30 days
• Handicap is NOT protected by this law (See Fair Housing Lending Laws)
19.What regulation is ECOA?
Answer Reg B (Be Equal)
20.Who oversees ECOA?
Answer Consumer Financial Protection Bureau (CFPB)
21.How long must records be kept under the ECOA?
Answer 25 Months (25 letters in "Equal Credit Opportunity Act)
22.What are the penalties for violating ECOA?
Answer $10k individual fine
$500,000 Class Action Lawsuit
23.HMDA
Answer Home Mortgage Disclosure Act
24.What does HMDA do?
Answer • Provides Data to public, assists public officials, and identifies
evidence of descrimination
• Stops Redlining
(Government monitoring section 10 of 1003
