8/14/2021

Mortgage Summary Laws








REG B

Equal Credit Opportunity Act  1974 

ECOA under TILA TITLE XIV

Federal Reserve is boss

prevents discrimination/ redlining

Fair Housing Act race/color/religion/national origin/sex/familial status/ HANDICAP

1st lien

denial in 30 days called adverse action with reasons

If more than 1 applicant notice to one is okay

free copy of appraisal

Borrower gets copy of appraisal 3 days prior to consumation.

Minor revisions of appraisal borrower can waive the 3 days at close

Not closed consumated appraisal to borrower before 30 days

cannot ask about Mrs. Ms. Miss

FINES: $10,000 individual actions. Cass actions: penalty of $500,000 or 1% of the creditor's net worth, whichever is lower.

Ethic means Latino... 

Race is American Indian/Asian/Black/Native Hawaiian/ 

Not covered are: manufactured, reverse, business, loan modifications

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REGULATION C

Home Mortgage Disclosure Act  HMDA

CFPB amended dwelling-secured standard for all loans or lines of credit that are for personal, family, or household purposes. Thus, most consumer-purpose transactions, including closed-end home-equity loans, home-equity lines of credit, and reverse mortgages, are subject to the regulation. 

All closed end loans for home improvement, purchase or refinance

transactional coverage to require reporting of all open end not home-equity lines of credit.

Federal Reserve

2017 platform/website

Loan data and low to moderate income data

Loan Application Register LAR report Annually

loan number/date/ loan type/ $ purpose/property type/occupancy/preapproval/actions/

DTI/ location/ ethnicity (Hispanic)/ race/ sex/ income/ pice/ HOEPA/ rate/ points/FICO/DU or LP/age/

Depository banks report to supervising agencies, non depository report to HUD US Dept of Housing and Urban Development. The Federal Financial Institutions Examination Council posts the records FFIEC  

Fines: $10000 or $500,000 or 1% of worth


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REGULATION X

RESPA Real Estate Settlement Procedures Act

1-4 units and 2nd trust deeds

8 a) no kickbacks

8 b) no splits 

8 c) no unearned $ no attorney or broker referral fees

servicers disclose % of loans sold

FINES: $10000 and 1 year jail


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Regulation Z

CFBP Federal Trade Commission FTC

TILA Truth in Lending HOEPA Home Ownership and Equity Protection Act of 1994

Competitive Equality Banking Act of 1987 - Title I: Financial Institutions Competitive Equality - Amends the Bank Holding Company Act of 1956 

1974 RESPA Act

ABILITY TO REPAY

APR disclosure

CFPR rule 2018 Servicer statement books in BK disclose 14 days after event

Title X Dodd Frank

Predatory lending in refinances and closed-end home equity loans with high interest rates or high fees.

HOEPA Section 32 loans must also meet the same APR and APOR criteria as Section 35 loans, but Section 32 loans also include these three additional criteria, which do not apply to Section 35 loans:

  1. The APR is higher than the APOR by more than 6.5 percent.
  2. Total lender/broker points and fees are greater than 5 percent of the total loan amount. This percentage includes certain fees such as origination fees, broker fees, processing fees and servicing setup fees.
  3. A prepayment penalty exceeds 2 percent of the prepaid amount or occurs more than 36 months after closing. lender cannot extend an HPML without setting up an escrow account to collect premium payments for property taxes / insurance except cooperative shares dwelling’s initial construction loan, bridge loans that have loan terms of 12 months or less, Reverse mortgages, certain located in rural or underserved areas

2013 HOEPA Rule 

 6.5 % points for first-lien loans or

  8.5 % points for subordinate-lien loans 

 8.5 % points for first-lien loans if dwelling is personal property and less than $50,000

Points and Fees Test: Points and fees exceeding the greater of 

 5 % of the total loan amount if loan amount is $20,000 or more; or

  The lesser of 8% or $1,000 for loan amounts less than $20,000 (adjusted annually); or

 TILA Higher-Priced Mortgage Loans Appraisal Rule

Section 35 APR higher than APOR by 6.5

prepayment penalty 36 months


Fines: $5000 - 1 million or 1% of worth


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Telephone Consumer Protection Act of 1991 

amended from Communications Act of 1934

auto dialers, do not call

FCC regulates

Fines: $1500 

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Gram Leach Bliley 

Privacy  - Affiliated Parties

consumer vs customer ( has an account and applied)

2011 went under CFPB

2016 only need to give initial notice if they do not share

Must notify annually and at opening

Fines: lessor of 1 million or 1% assets 5 years jail

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FACT Act 2003 FACTA

amended Fair Credit Reporting Act

Red flags

utility companies don't need social security # covered accounts risk identity theft

CREDITOR = bank, broker, or auto dealer

fraud alerts

FINES: $100 -1000

Identity theft, free annual credit report every 12