Question 1

RESPA requires disclosure of estimated closing costs for residential loans at which of the following times?

Accepted Answer

A)   Any time prior to actual closing
B)   Within three days of loan application
C)   Only if requested by the borrower
D)   Within three days of loan application and again one day prior to closing if the borrower request itE) A) and C)
F) A) and D)

Question 2

Which of the following is a prohibited practice as defined by RESPA requirements?

Accepted Answer

A)   A listing broker splits the real estate commission with a selling broker
B)   A lender refuses to accept an insurance company for coverage even though requested by the borrower
C)   A seller requires the use of a specific title company as a condition of the sale
D)   A selling broker provides the buyer/borrower with assistance in obtaining a loan in return for a feeE) C) and D)
F) A) and B)

Question 3

The primary purpose of the Truth-in-Lending Act is to

Accepted Answer

A)   require full disclosure of the amount of the promissory note
B)   provide meaningful information to borrowers on the cost of consumer credit
C)   discourage excessive loan costs for consumers
D)   establish limits on the total charges a lender can assess for a loanE) None of the above
F) A) and B)

Question 4

The underlying purpose of RESPA requirements is to:

Accepted Answer

A)   require disclosures that give a buyer/borrower sufficient information to make informed decisions
B)   increase federal control over real estate deals
C)   introduce complex questions that necessitate employing legal counsel
D)   limit costs of closing a real estate transactionE) A) and B)
F) None of the above

Question 5

The Truth-in-Lending Act allows certain transactions to be rescinded by consumers; Transactions exempt from this right of rescission include which of the following residential mortgage transactions?

Accepted Answer

A)   Cash out refinance
B)   Reverse Annuity Mortgage
C)   Purchase Money Mortgage
D)   Home Equity Line of CreditE) A) and C)
F) B) and C) C

Question 6

All of the following charges involved with the settlement of a residential mortgage loan must be paid at time of closing EXCEPT:

Accepted Answer

A)   Prepaid principal
B)   Property taxes
C)   Hazard insurance premium
D)   Prepaid interestE) B) and C)
F) B) and D) A

Question 7

A mortgagee's title policy protects which of the following against an adverse claim of title?

Accepted Answer

A)   Borrower
B)   Trustee
C)   Real Estate agent
D)   LenderE) A) and B)
F) All of the above

Question 8

Real estate settlement procedures for residential loans, including the required settlement statement, are regulated by the

Accepted Answer

A)   Office of Thrift Supervision
B)   Fannie Mae-Freddie Mac
C)   Department of Housing and Urban Development
D)   Federal Reserve BankE) C) and D)
F) A) and D) C

Question 9

After initial closing deposits have been made, RESPA limits the continuing escrow or reserve account cushion held by lenders on residential loans to which of the following?

Accepted Answer

A)   Not more than is reasonable and customary
B)   Not more than one sixth of the annual recurring charges
C)   Not more than one twelfth of the annual recurring charges
D)   No restrictions apply after the initial deposits have been madeE) B) and D)
F) All of the above

Question 10

In closing a real estate transaction, instructions on how the proceeds of a loan are to be disbursed are issued by the

Accepted Answer

A)   Closing agent
B)   Seller's agent
C)   Lender
D)   Trustee's AttorneyE) A) and B)
F) C) and D)

Question 11

The variance 3/7/3 Rule requires a seven business day waiting period once the initial disclosure is provided before closing a home loan if the Good Faith Estimate turns out to be off by more than the variance percentages established by which of the following new legislative actions?

Accepted Answer

A)   Mortgage Disclosure Improvement Act of 2008
B)   American Recovery and Reinvestment Act of 2009
C)   The Frank-Dodd Act of 2011
D)   The Community Reinvestment ActE) A) and B)
F) A) and C)

Question 12

In a settlement procedure, prepaid interest is required for the time period from September 21 (date of closing)  through September 30. What amount of prepaid interest is due for a loan of $200,000 at 5% interest? (Banker's year is 360 Days)

Accepted Answer

A)   $250.00
B)   $277.78
C)   $246.57
D)   208.33E) B) and D)
F) All of the above

Exam 16: Settlement Procedures

RESPA requires disclosure of estimated closing costs for residential loans at which of the following times?

Correct Answer
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Which of the following is a prohibited practice as defined by RESPA requirements?

Correct Answer
verified

The primary purpose of the Truth-in-Lending Act is to

Correct Answer
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The underlying purpose of RESPA requirements is to:

Correct Answer
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The Truth-in-Lending Act allows certain transactions to be rescinded by consumers; Transactions exempt from this right of rescission include which of the following residential mortgage transactions?

Correct Answer
verified
C

All of the following charges involved with the settlement of a residential mortgage loan must be paid at time of closing EXCEPT:

Correct Answer
verified
A

A mortgagee's title policy protects which of the following against an adverse claim of title?

Correct Answer
verified

Real estate settlement procedures for residential loans, including the required settlement statement, are regulated by the

Correct Answer
verified
C

After initial closing deposits have been made, RESPA limits the continuing escrow or reserve account cushion held by lenders on residential loans to which of the following?

Correct Answer
verified

In closing a real estate transaction, instructions on how the proceeds of a loan are to be disbursed are issued by the

Correct Answer
verified

The variance 3/7/3 Rule requires a seven business day waiting period once the initial disclosure is provided before closing a home loan if the Good Faith Estimate turns out to be off by more than the variance percentages established by which of the following new legislative actions?

Correct Answer
verified

In a settlement procedure, prepaid interest is required for the time period from September 21 (date of closing) through September 30. What amount of prepaid interest is due for a loan of $200,000 at 5% interest? (Banker's year is 360 Days)

Correct Answer
verified

Exam 16: Settlement Procedures

RESPA requires disclosure of estimated closing costs for residential loans at which of the following times?

Correct AnswerverifiedShow Answer

Which of the following is a prohibited practice as defined by RESPA requirements?

Correct AnswerverifiedShow Answer

The primary purpose of the Truth-in-Lending Act is to

Correct AnswerverifiedShow Answer

The underlying purpose of RESPA requirements is to:

Correct AnswerverifiedShow Answer

The Truth-in-Lending Act allows certain transactions to be rescinded by consumers; Transactions exempt from this right of rescission include which of the following residential mortgage transactions?

Correct AnswerverifiedC

All of the following charges involved with the settlement of a residential mortgage loan must be paid at time of closing EXCEPT:

Correct AnswerverifiedA

A mortgagee's title policy protects which of the following against an adverse claim of title?

Correct AnswerverifiedShow Answer

Real estate settlement procedures for residential loans, including the required settlement statement, are regulated by the

Correct AnswerverifiedC

After initial closing deposits have been made, RESPA limits the continuing escrow or reserve account cushion held by lenders on residential loans to which of the following?

Correct AnswerverifiedShow Answer

In closing a real estate transaction, instructions on how the proceeds of a loan are to be disbursed are issued by the

Correct AnswerverifiedShow Answer

The variance 3/7/3 Rule requires a seven business day waiting period once the initial disclosure is provided before closing a home loan if the Good Faith Estimate turns out to be off by more than the variance percentages established by which of the following new legislative actions?

Correct AnswerverifiedShow Answer

In a settlement procedure, prepaid interest is required for the time period from September 21 (date of closing) through September 30. What amount of prepaid interest is due for a loan of $200,000 at 5% interest? (Banker's year is 360 Days)

Correct AnswerverifiedShow Answer

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C

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A

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C

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