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1. Question

A borrower reviews the final Closing Disclosure and notices a separate fee labeled “Closing Disclosure Preparation and Delivery Fee.” The lender explains that the fee covers administrative costs associated with preparing federally required disclosures.

During a RESPA compliance review, regulators question whether the charge is permissible.

Which statement correctly reflects RESPA requirements regarding disclosure preparation fees?

A) RESPA prohibits lenders and settlement service providers from charging borrowers fees for preparing and distributing the Closing Disclosure and certain required disclosures
B) Lenders may charge separate disclosure preparation fees if the borrower signs a waiver
C) Disclosure preparation fees are permitted only on conventional mortgage loans
D) RESPA allows disclosure preparation fees if the charges total less than $100

2. Question

A settlement company removes a prohibited “TILA Disclosure Preparation Fee” from the itemized closing costs but increases a separate “General Administrative Closing Fee” by the same amount. The borrower later alleges the company attempted to indirectly recover prohibited disclosure fees.

Which statement best reflects RESPA’s position regarding indirect disclosure charges?

A) RESPA permits prohibited fees if they are grouped into administrative expenses
B) Prohibited disclosure fees may be indirectly recovered through higher escrow charges
C) RESPA prohibits burying disclosure preparation charges in generic closing cost fees or recouping them indirectly through other charges
D) Indirect disclosure charges are permitted if disclosed verbally to the borrower

3. Question

A creditor originates a closed-end consumer loan secured by a cooperative housing unit in a state where cooperative interests are not classified as real property. The lender questions whether integrated TILA-RESPA disclosures are still required.

Which statement correctly reflects the 2017 TILA-RESPA Rule regarding cooperative units?

A) Integrated disclosures are required only if state law classifies cooperative units as real property
B) Cooperative unit loans are exempt from integrated disclosure requirements
C) The 2017 TILA-RESPA Rule requires integrated disclosures for closed-end consumer loans secured by cooperative units regardless of state law classification
D) Cooperative unit loans require disclosures only when the borrower occupies the property as a primary residence

4. Question

A trust established for estate planning purposes applies for consumer mortgage credit. The lender questions whether Regulation Z disclosures are required because the borrower is technically a trust rather than an individual.

Which statement correctly reflects the 2017 TILA-RESPA Rule regarding certain trusts?

A) Credit extended to certain trusts established for tax or estate planning purposes is treated as credit extended to a natural person for disclosure purposes
B) Regulation Z disclosures are never required for trusts
C) Trust-related mortgage loans are governed exclusively by state trust law
D) Disclosures are required only if the trust owns commercial property

5. Question

A borrower questions a document copying fee charged at closing. The settlement agent explains that the fee relates to copying and preparing loan documents other than federally prohibited disclosure forms.

Which statement correctly reflects RESPA fee limitations?

A) RESPA prohibits all document preparation and copying fees at closing
B) Lenders and settlement agents may charge fees for copying and preparing documents other than prohibited disclosure forms, subject to applicable state law restrictions
C) Settlement agents may charge unlimited document preparation fees without restriction
D) Document preparation fees are allowed only for reverse mortgages

6. Question

During a CFPB audit, regulators request copies of RESPA-related loan documents from a mortgage lender. The lender destroyed the files two years after loan consummation, believing no further retention requirement applied.

Which statement correctly reflects RESPA document retention requirements?

A) All RESPA-related documents must be retained for three years after consummation
B) RESPA-related documents may be destroyed immediately after closing
C) RESPA requires all records to be retained for ten years
D) Record retention rules apply only to FHA-insured loans

7. Question

A lender transfers servicing rights to another institution and later destroys copies of completed Closing Disclosures four years after consummation. During a regulatory examination, auditors determine the lender failed to comply with applicable retention requirements.

Which statement correctly reflects Closing Disclosure retention requirements?

A) Closing Disclosures must be retained for one year after consummation
B) Closing Disclosures are exempt from RESPA retention rules
C) The Closing Disclosure must be retained for five years after consummation
D) Closing Disclosures may be destroyed once servicing rights are transferred

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