CR10 - Good Faith Estimate HUD-1 Flashcards

CR10 - Good Faith Estimate & HUD-1 Flashcards B372A556BB10142FEA08B00CE723B8D65Not answered.The correct answer is b. A is incorrect because the GFE must be accurate within specific tolerances. C is incorrect because the bank is bound by the GFE and specific tolerances unless there is a changed circumstance or a borrower-requested change. D is incorrect because there are specific tolerances for some categories of settlement services.

• Which sentence accurately describes the requirements

of a Good Faith Estimate?A. It is intended to be only an ''estimate'' of the loan terms and settlement costs and not an exact accounting, so accuracy is not importantB. A loan originator is bound to the settlement charges and terms listed on the GFE within specified tolerancesC. Anytime the estimated cost exceeds the estimated cost of the settlement services by any amount, the borrower must be compensatedD. It is only required for construction-permanent loans because those costs are most often confusing for the borrower A66D360B2EA1F47BD9ABDEEF704B59BEBNot answered. The correct answer is a. B, C, and D are incorrect because if any of the loan terms on the final HUD-1 are incorrectly itemized (but the corresponding terms on the final GFE are correct), then the final HUD-1 may be amended, identified on the form itself as an amendment, and re-signed by the borrower to correct the error.

• The HUD-1 Settlement Statement is designed to allow

the borrower review and approve the mortgage terms and fees for the loan in which they applied. If any of the loan terms on the final HUD-1 are incorrectly itemized (but the corresponding terms on the final GFE are correct), then what must happen?A. The final HUD- 1 may be amended, identified on the form itself as an amendment, and re-signed by the borrower to correct the errorB. The loan closing must be postponedC. The loan closing may proceed, but the borrower must be financially compensatedD. No action is required-the Good Faith Estimate is only an estimate and the amounts will never match exactly BCFE5F548AC7E4796ADD2BC6C0F4E811DNot answered. The correct answer is b. A, C, and D are incorrect because the HUD-1A is used when there is no seller such as in the case of a refinance or a home equity loan.

• Either the HUD-1 or the HUD-1A should be used for

every RESPA-covered transaction not subject to the TILA/RESPA Integration rules. Under what circumstances might a lender use the HUD-1A instead of the HUD-1?A.The lender completed the HUD-1 incorrectly. The HUD-1A is the second version of the HUD-1B. The HUD-1A is used in cases where there is no seller such as in the case of a refinance or a home equity loanC. The borrower could not be present at closing. The HUD-1A serves as a power of attorney formD. The borrowers are not married. The primary borrower signs the HUD-1 and the secondary borrower signs the HUD-1A BDDC90E0207B44A08BBF723BAE56FBB9CNot answered. The correct answer is b. A, C, and D are incorrect because a borrower has the right to receive the HUD-1 with as much information as available on the business day before the date of settlement or closing. The

final HUD-1 should be provided to the borrower at closing.

• The HUD-1 statement itemizes the services provided by

the lender and the fees associated with these services. At what two points in time must the borrower receive the HUD-1?A. At application and before the borrower takes possession of the propertyB. On the business day before

the date of settlement or closing and at closingC. Within 3 days of application and within a week of receiving the GFED. At application and at closing D6C9F4435A40F40CA9CD285879AB84266Not answered.The correct answer is d. A, B, and C are incorrect because a borrower has the right to receive the HUD-1 with as much information as available on the business day before the date of settlement or closing. The final HUD-1 should be provided to the borrower at closing.

• At what two points in time must the borrower receive the

HUD-1?A. At application and before the borrower takes possession of the propertyB. Within 3 days of application and within a week of receiving the GFEC. At application and at closingD. On the business day before the date of settlement or closing and at closing C1937D90030B94441B35FBC3F684564B1Not answered.The correct answer is c. A, B, and D are incorrect because the HUD-1A is used when there is no seller such as in the case of a refinance or a home equity loan.

• The HUD-1 Settlement Statement itemizes the

settlement services provided by the lender and the fees associated with these services. Under what circumstances might a lender use the HUD-1A instead of the HUD-1?A.The lender completed the HUD-1 incorrectly. The HUD-1A is the second version of the HUD-1B. The borrower could not be present at closing. The HUD-1A serves as a power of attorney formC. The HUD-1A is used in cases where there is no seller such as in the case of a refinance or a home equity loanD. The borrowers are not married. The primary borrower signs the HUD-1 and the secondary borrower signs the HUD-1A C05AF7E3A7D054078828680B6167A0321Not answered.The correct answer is c. A is incorrect because a GFE is not required when a loan is denied within 3 business days of receiving the application. B is incorrect because a GFE is not required if the application is withdrawn within 3 business days of submission. D is incorrect because there is no requirement to provide the GFE for non-real estate secured transactions.

• As a loan processor for Safe Bank, Suzy Chu is

responsible for ensuring the borrower receives the required disclosures. She currently has a drawer full of loan files and is trying to determine under which circumstance is a Good Faith Estimate required. Which loan application requires a Good Faith Estimate?A. Tom Dilly's application that was denied within three business days of receiving itB. Winnie Frank's application that she withdrew within three days of submissionC. Rich Katz's application for a 15-year fixed rate mortgageD. Karen D'Amosa's application for an unsecured open-end line of credit covered by Regulation Z C5514C2ACDDFF4F3DB9447197EE7640B6Not answered. The correct answer is c. A is incorrect because charging a fee to complete RESPA disclosures is a violation of RESPA. B and D are incorrect because a lender may not charge any fee before issuing a GFE other than a reasonable fee for obtaining a credit report.

• What fees can a loan originator charge before issuing a

Good Faith Estimate?A. A fee for completing the RESPA disclosuresB. A loan application feeC. A reasonable fee for obtaining a credit reportD. A fee to cover the cost of the credit report and the appraisal C7B60196653814C4BB0A3CFA32C1709EANot answered.The correct answer is c. A, B, and D are incorrect because a borrower has the right to receive the HUD-1 with as much information as available on the business day before the date of settlement or closing. The final HUD-1 should be provided to the borrower at closing.

• RESPA requires that the HUD-1 Settlement Statement

be made available to the borrower. At what two points in time must the borrower receive the HUD-1?A. At application and before the borrower takes possession of the propertyB. Within 3 days of application and within a week of receiving the GFEC. On the business day before the date of settlement or closing and at closingD. At

application and at closing