guide explaining the home buying process. A copy is in

Real Estate - Finance Regulations (TILA and RESPA) Flashcards APR - Annual Percentage Rate- The annual percentage rate (APR) combines the interest rate with other costs of the loan (e.g., discount points) into a single figure that reflects the actual annual cost of the loan as a percentage.Benefits of RESPA for Borrowers- The lender must give the borrower a copy of the Consumer Financial Protection Bureau's information booklet (Your Home Loan Toolkit), which is a step-by-step guide explaining the home buying process. A copy is in your course handouts.The lender must give the borrower two disclosure forms describing all closing costs, fees, and good faith estimates of charges associated with the loan and settlement process.You might be thinking that these are some of the same provisions and consumer benefits described earlier with TILA. This is true and for that reason, the Dodd-Frank Act of 2010 has integrated the overlapping disclosures that consumers receive under TILA and RESPA in connection with applying for and closing on a mortgage loan.Loan Estimate Form- integrates and replaces the Good Faith Estimate (GFE) and the "early" Truth-in-Lending (TIL) disclosure statement.This disclosure promotes comparison shopping by providing a summary of applicable loan terms and estimates of loan and closing costs consumers can expect

to pay (or not pay) at closing. This includes:estimated

monthly paymentestimated taxes, insurance, and assessmentsestimated closing costs and required cash to closeservices that can and cannot be shopped forThe lender is expected to make the required early disclosures in good faith, based on the best information available at the time.Federal Consumer Credit Protection Act- enacted in 1969- commonly referred to as "truth in lending" act. (TILA).- require all creditors who deal with consumers to make full disclosure of finance charges and related costs of obtaining credit- allow the borrower to rescind credit transactions under some circumstances- regulate the use of any advertising about creditTILA is administered by the Federal Trade Commission (FTC) under a set of regulations known as "Regulation Z." Loan Estimate Disclosure Form- must be in writing and provided by lender or placed in mail to loan applicant no later than three business days after receipt of the consumer's completed loan application

AND no later than seven business days prior to consummation of the loan- The delivery dates stated above create a mandatory seven-business-day waiting period between loan application and loan consummation, allowing the consumer time to read, research, and understand the initial disclosures.In addition, the consumer is allowed to ask for and consider Loan Estimates from several different lenders. This waiting period also allows the consumer time to compare costs of other lenders.- The seven-business-day waiting period may be waived by the consumer, but only for a bona fide personal financial emergency. In this case, a written waiver, signed and dated, must be provided by the consumer.Let's look at an example.Loan Classifications exempt from TRID- home equity lines of credit (HELOCs)reverse mortgagesmortgages secured by a mobile home, boat, or

other chattel dwelling not attached to landloans made by a person that makes five or fewer mortgage loans a year a year (Such a person does not meet the definition of "creditor" under Regulation Z.)

Closing Disclosure- For loans that require a Loan Estimate and that proceed to closing/settlement, the creditor must prepare and provide to the loan applicant a Closing Disclosure form. This form reflects the final terms of the transaction.The Closing Disclosure includes a detailed accounting of the mortgage transaction, including a breakdown of the closing costs to be paid by the buyer, seller, and others (e.g., the lender).It integrates and replaces the Housing and Urban Development (HUD-1) Settlement Statement and the "final" TIL statement.- must be provided by the creditor to the consumer no later than three business days prior to loan consummation.The loan may not be consummated less than three days business days after the consumer receives the Closing Disclosure unless the borrower has a bona fide personal financial emergency.In this case, the creditor can rescheduled the closing sooner with a written waiver, signed and dated, and provided by the consumer.Advertising with TILA- If an ad mentions ANY other "specific credit term" from the following list of "triggering terms," then additional

disclosures must be made:- the down payment- the amount

of any payment- the number of payments- the period of repayment- the amount of the finance charge (or the statement that there is no charge for credit)(A good rule is "specific credit term" involves a dollar amount.)If the ad mentions any of these terms ^^ then all of these must be

dsiclosed:- the down payment- the terms of repayment- the

APR Loans that are currently subject to TILA but not RESPA are

subject to the TRID requirements, including:

• Construction-only loans- Loans secured by vacant land or

by 25 or more acres- Credit extended to certain trusts for tax or estate planning purposes also are covered by the TRID Rule Your home loan toolkit- The Loan Estimate and the Closing Disclosure forms are found in the CFPB booklet called _____.Penalties for Violating TILA- criminal penalties for willfully violating the Act:up to 1 year

in jail, and/or a fine of up to $5,000- civil penalties:punitive

damages up to twice the finance charges involved, up to a maximum of $5,000actual damages, attorney fees, and court costs Provisions of TILA- the borrower must be given written disclosure documents concerning finance charges and related costs, as well as certain details obtaining credit. This provision of the law came about as a result of the fact that prior to the implementation of the Act, lenders often advertised a particular rate for a loan but wound up charging the borrower a higher rate.The specific items that must be