Section 4 Lesson 2 2

A borrower submits a complete mortgage application and receives the Home Loan Toolkit two days later. The borrower questions whether this timing complies with federal disclosure rules. How should this situation be evaluated?

A borrower receives a Closing Disclosure only two days before closing. The lender states the borrower verbally agreed to proceed. How should this be evaluated?

A borrower receives a Closing Disclosure and wants time to compare it with the Loan Estimate and consult an advisor. Why does the regulation require a three-day waiting period before closing?

A lender denies a completed loan application but does not send a written notice explaining the reason. The borrower questions whether this violates federal law. How should this be evaluated?

A borrower submits an incomplete application and the lender decides not to proceed. The borrower receives no immediate notice. When must the creditor provide notification under ECOA?

A borrower receives a counteroffer but does not accept or use the credit offered. The borrower later asks whether the lender was required to send a notice. How should this be evaluated?

A lender sends an adverse action notice but omits the name and address of the federal agency that enforces compliance. Why is this a violation?

A borrower receives an adverse action notice that states only that the loan was denied, without providing reasons or statutory language. How should this be evaluated?

A borrower receives an adverse action notice without reasons for denial. Forty-five days later, the borrower requests the reasons in writing. How must the creditor respond?

A lender provides adverse action reasons orally and does not mention any right to written confirmation. The borrower later requests written confirmation. What must the lender do?

A lender delays issuing the ECOA notice until underwriting is complete. The borrower questions whether this complies with disclosure requirements. How should this be evaluated?

A borrower applies for an adjustable-rate mortgage and receives the ARM disclosure five days later. How should this be evaluated?

A borrower receives the Home Loan Toolkit four business days after application. The lender claims this is acceptable. How should this be evaluated?

A lender provides the Loan Estimate four business days after receiving a complete application. The borrower questions whether this meets timing requirements. How should this be evaluated?

A lender provides a list of homeownership counseling agencies that was generated 60 days earlier. How should this be evaluated?

A borrower receives the appraisal on the day of closing. The lender claims the borrower waived early delivery. How should this be evaluated?

A borrower does not receive the Summary of Rights under FCRA or the FACTA credit score disclosure within three business days of application. How should this be evaluated?

A lender delays providing the GLBA privacy notice until after closing. The borrower questions whether this complies with disclosure rules. How should this be evaluated?

A lender makes a counteroffer that the borrower does not accept. The lender does not send an adverse action notice. How should this be handled?

A borrower closes on a loan with private mortgage insurance but is not given information regarding PMI cancellation rights. How should this be evaluated?

A borrower purchases a home located in a 100-year flood zone but does not receive a flood hazard notice until after closing. How should this be evaluated?

During a purchase transaction, a real estate brokerage refers a borrower to a title company for settlement services. The borrower later learns the broker owns 2% of the title company. The file does not contain any disclosure about this relationship. Based on RESPA requirements, what must have occurred?

A loan officer refers a borrower to a settlement services provider owned by the lender’s parent company. The disclosure omits estimated charges. What must the AfBA disclosure include?

A borrower is told they must use an affiliated settlement provider, even though the provider is not an attorney, appraiser, or credit reporting agency. How does RESPA treat this situation?

A lender refers a borrower to an appraiser used to protect the lender’s interest. The borrower asks if another appraiser may be used. How does RESPA apply?

A settlement service provider is partially owned by a referring party with exactly 1% ownership. How does RESPA classify this relationship?

A lender issues a Loan Estimate and later realizes certain fees changed, even though no valid change of circumstance occurred. The lender issues a revised Loan Estimate anyway to reflect the new figures. How should this action be evaluated?

A creditor issues multiple revised Loan Estimates during processing, even though no valid triggering event occurred. The borrower becomes confused about the final loan terms. Why is this practice discouraged?

A lender plans to issue a revised Loan Estimate due to a valid change in circumstance. By what deadline must the revised Loan Estimate be delivered?

A borrower receives a Loan Estimate and asks how long the quoted fees are valid. What is the correct explanation?

A lender collects a fee from a borrower before issuing the Loan Estimate. Which fee is permitted to be collected at that stage?

A Loan Estimate is delivered to a borrower, and closing is scheduled shortly thereafter. What is the minimum amount of time that must pass between delivery of the Loan Estimate and consummation?

A creditor discovers a valid change in circumstance affecting settlement charges. When must the revised Loan Estimate be issued?

A lender chooses to issue a revised Loan Estimate even though no change in circumstance occurred. How is this classified?

A borrower submits a loan application with a floating interest rate. Two days later, the borrower locks the rate, which causes the discount points and lender credits to change. The loan officer reviews the file to determine whether updated disclosures are required.

A lender experiences an increase in settlement charges during processing but decides to absorb the cost instead of passing it on to the borrower.

A borrower requests a change to the loan program that affects settlement charges. The loan officer reviews whether a new disclosure is required.

Updated documentation shows the borrower no longer qualifies for the originally quoted loan program.

A lender becomes aware of a qualifying changed circumstance but waits six business days before issuing a revised Loan Estimate.

A lender experiences a change in settlement charges but chooses not to increase the borrower’s fees.

A construction loan’s settlement date is delayed due to permitting issues.

A creditor wants to recover increased fees caused by a valid changed circumstance.

A lender issues a revised Loan Estimate even though no triggering event occurred.

A borrower asks why a revised Loan Estimate was required after locking the interest rate.

A lender chooses not to issue a revised Loan Estimate after a changed circumstance and later attempts to increase fees.

A lender fails to issue a revised Loan Estimate within the required timeframe and later attempts to collect higher charges.

A borrower submits a loan application and asks when they should expect to receive information about homeownership counseling options. The loan officer reviews disclosure timing requirements.

A lender prepares to issue the Closing Disclosure and wants to ensure it is delivered within the proper timeframe prior to closing.

A creditor provides a corrected Closing Disclosure due to changes in loan terms. The borrower asks whether a new waiting period applies.

After consummation, a settlement change causes the Closing Disclosure to become inaccurate and affects the amount paid by the borrower.

A lender prepares the final Closing Disclosure prior to settlement and wants to confirm delivery timing requirements.