TRUTH IN LENDING ACT (R.A. 3765) I.Purpose: To protect the citizens of the state from a lack of awareness of the true cost of credit to the user through a guaranteed full disclosure of such cost with a view of preventing the uninformed use of credit to the detriment of the national economy.
The correct answer is D. Under Truth in Lending, the lender must disclose all finance charges which might include buyer's points, loan fees, finder's fees paid to the person bringing the borrower to the lender, service charges, mortgage insurance premiums and interest.
The correct answer is A. HOEPA rules primarily affect refinancing and home equity installment loans that also meet the definition of a high-rate or high-fee loan. The rules do not cover loans to buy or build a home, reverse mortgages or open-end loans (e.g., home equity lines of credit). the cancellation date of PMI.
The lender is required to provide to the borrower information on this right in the form of two copies of a notice of the right to rescind, as well as a copy of the disclosure statement. a statement of the interest rates for the same loan with higher and lower down payments.
Truth-in-Lending applies to loans made to individuals for personal, family, or household purposes. For personal property loans the law only applies if the loan does not exceed $25,000. For residential real property loans the law applies regardless of the loan amount. It does not apply to business, agricultural or commercial loans or loans made to partnerships, corporations, etc. The lender must disclose all finance charges (loan fees, finder's fees paid to the person bringing the borrower to the lender, service charges, points, mortgage insurance premiums and interest). He must add these charges together and calculate them as a percentage of the loan balances during the term of the loan to arrive at an "annual percentage rate" (APR). The APR can then be used as a means of comparing costs among lenders. Actual costs not retained by lenders (title fees, legal fees, closing costs, property taxes, appraisal fees, recording fees, notary fees, etc.) are not considered finance charges and are not included in the APR.
The term of each loan. Interest, service charges, transaction charges, buyer's points, loan fees and mortgage insurance are examples of what is included in the dollar amount called the. finance charge. The Truth in Lending Act does all of the following EXCEPT. TILA does not set interest rates.
TILA requires a disclosure of the terms of the credit transactions , including costs and key provisions. RESPA requires disclosure of closing costs and loan servicing practices. ECOA requires disclosure of the appraisal.
Money that is paid to and kept by a lender is a finance charge, included in the APR calculation. This includes the loan origination fee. With regard to real estate transactions, the other choices are closing costs reported under RESPA.
TILA does not set interest rates. It does require disclosures to enable consumers to compare costs of credit offered, provide rescission rights for some transactions, and impose restrictions on home equity lines of credit (as a result of the Homeownership and Equity Protection Act).
The creditor cannot charge a prepayment penalty if the source of the prepayment funds is a refinancing by the creditor or its affiliate.
The TILA disclosure shows the APR, monthly payments and amount financed (the loan amount less finance charges). For real property loans, it does not include property appraisal fees.
The Credit Card Accountability Responsibility and Disclosure Act (known as the Credit CARD Act of 2009) is a law intended to curtail deceptive and abusive practices by credit card issuers. The bill expanded on the Truth in Lending Act (TILA), and the United States Congress passed the CARD Act in 2009. It took effect in 2010.
Except for those younger than age 21, the CARD Act shouldn't affect most people's ability to get or use a credit card. Still, since card issuers do need to consider a person's ability to repay a debt, there is a possibility that some people who could receive credit cards in the past may be denied or offered a lower credit limit today.
Title I: Consumer Protection - Offers protection for credit cardholders against increases in fees and interest rates as well as unclear and unduly short notifications about changes. Credit card companies are now required to take into consideration new applicants' "ability to pay" before approving that applicant for new cards.
In compliance with the CARD Act of 2009, issuers had to improve upon the readability of their credit card statements while also adding information that could prove vital for cardholders.
You're only protected during the first year of a new account (with a few exceptions, such as variable rates that are tied to an index). But your rate on that card can increase significantly on your future purchases as long as you're given 45 days' notice.
Title II: Enhanced Consumer Disclosures - Revises and expands requirements for mandatory minimum payment disclosures provided by a creditor, such as payoff timing, penalties and renewals, as well as prevention of deceptive marketing of credit reports.
Some cards charge multiple interest rates. For instance, a cardholder may have a promotional APR that applies to a balance transfer and a higher rate for purchases. Under the CARD Act, payments must be applied to balances with the highest interest rate first.
T or F: The bankruptcy judge is the person who handles the assets and obligations of the debtor during the bankruptcy proceeding.
T or F: Property inherited by the debtor within 180 days of the bankruptcy petition date becomes property of the bankruptcy estate.
T or F: The basic purpose of bankruptcy is to allow a debtor in a difficult financial situation a fresh financial start.
T or F: In a typical chapter 13 bankruptcy, one half of the debtors take home pay is allocated to repay debts.
T or F: A trustee may not assume an executory contract in a bankruptcy preceding that requires the other party to make a loan, deliver equipment or issue a security to the debtor.
The servicer is required to respond to the borrower’s complaint in writing within 20 business days of receipt of the complaint. The servicer has 60 business days to correct the issue or give its reasons for the validity of the account's current status.
The information disclosure should include settlement services, relevant consumer protection laws, and any other information connected to the cost of the real estate settlement process. Business relationships between closing service providers and other parties connected to the settlement process should also be disclosed to the borrower. 2.
The Real Estate Settlement Procedures Act (RESPA) was enacted by Congress in 1975 to provide homebuyers and sellers with complete settlement cost disclosures. RESPA was also introduced to eliminate abusive practices in the real estate settlement process, prohibit kickbacks, and limit the use of escrow accounts. RESPA is a federal statute now regulated by the Consumer Financial Protection Bureau (CFPB).
RESPA requires lenders, mortgage brokers, or servicers of home loans to disclose to borrowers any information about the real estate transaction. The information disclosure should include settlement services, relevant consumer protection laws, and any other information connected to the cost of the real estate settlement process. Business relationships between closing service providers and other parties connected to the settlement process should also be disclosed to the borrower. 2
The types of loans covered by RESPA include the majority of purchase loans, assumptions, refinances, property improvement loans, and equity lines of credit. 1. RESPA requires lenders, mortgage brokers, or servicers of home loans to disclose to borrowers any information about the real estate transaction. The information disclosure should include ...
A plaintiff has up to one year to bring a lawsuit to enforce violations where kickbacks or other improper behavior occurred during the settlement process.
If the borrower has a grievance against their loan servicer, there are specific steps they must follow before any suit can be filed. The borrower must contact their loan servicer in writing, detailing the nature of their issue. The servicer is required to respond to the borrower’s complaint in writing within 20 business days of receipt of the complaint. The servicer has 60 business days to correct the issue or give its reasons for the validity of the account's current status. Borrowers should continue to make the required payments until the issue is resolved.