Table of Contents
What is the purpose of HOEPA?
The Home Ownership and Equity Protection Act (HOEPA) was enacted in 1994 as an amendment to the Truth in Lending Act (TILA) to address abusive practices in refinances and closed-end home equity loans with high interest rates or high fees.
Why is the HOEPA disclosure necessary?
The lender’s written disclosure must inform you that the loan constitutes a mortgage, so your home can be taken by the lender (potentially along with any equity you have built up in the home) if you fail to make your loan payments.
What is the Homeowners Protection Act?
PMI protects lenders from the risk of default and foreclosure. It allows prospective buyers who cannot, or choose not to, make a significant down payment to obtain mortgage financing at an affordable rate.
How does the Home Ownership and Equity Protection Act of 1994 define predatory mortgage lending?
The Home Ownership and Equity Protection Act of 1994 (HOEPA) was an attempt to address predatory practices in the home loan industry by providing borrowers with protections against loans with excessive fees and interest rates.
How does HMDA encourages fair lending?
HMDA requires that some financial institutions collect and disclose certain information about home mortgage loan applications. This helps with identifying discrimination and enforcing the law.
What is the purpose of the provisions in section 32 of Regulation Z?
Section 32 forbids lenders to engage in lending practices based on the property’s collateral value without taking into account whether the borrower can repay the loan.
What is HOEPA in real estate?
What is the primary purpose of an FHA conditional loan commitment?
Conditional Commitment Most commitment letters offer conditional approval, which means the lender agrees to fund the mortgage as long as certain conditions are met within a certain time frame.
In which situation does the Homeowners Protection Act provide that a consumer may request to have the PMI canceled once the loan has reached 80% of the original value?
You have the right to request that your servicer cancel PMI when you have reached the date when the principal balance of your mortgage is scheduled to fall to 80 percent of the original value of your home. This date should have been given to you in writing on a PMI disclosure form when you received your mortgage.
What is the purpose of HMDA reporting?
HMDA reporting allows regulators to analyze information on mortgage loans and mortgage lending trends in a number of categories, such as the number of pre-approvals made, the number of mortgages granted, loan amounts, and the purposes of individual loans.
What is the largest and most important function of the FHA?
Instead, its primary role is to insure mortgages FHA-approved lenders provide home buyers. One to four-unit residential properties, manufactured homes and hospitals are all included in the FHA program. As of 2012, the FHA had insured more than 34 million properties, making it the world’s largest mortgage insurer.
When can I stop paying FHA MIP?
When can you drop PMI on an FHA loan?
- Wait for MIP to expire — If you put down at least 10% when you bought the home, your FHA MIP expires after 11 years.
- Refinance into a conventional loan — Replacing your FHA loan with a conventional loan eliminates the FHA’s MIP requirement.
When did PMI become mandatory?
You must comply with the Act beginning July 29, 1999. The Act protects borrowers paying PMI who secure mortgages with their primary homes on or after July 29, 1999.
Why was HMDA created?
in determining whether financial institutions are serving the housing needs of their communities; public officials in distributing public-sector investments so as to attract private investment to areas where it is needed; and in identifying possible discriminatory lending patterns.
What is the purpose of the Truth in Lending Act?
The Truth in Lending Act (TILA) protects you against inaccurate and unfair credit billing and credit card practices. It requires lenders to provide you with loan cost information so that you can comparison shop for certain types of loans.
Who is subject to HMDA?
HMDA requires lenders to report the ethnicity, race, gender, and gross income of mortgage applicants and borrowers. Lenders must also report information regarding the pricing of the loan and whether the loan is subject to the Home Ownership and Equity Protection Act, 15 U.S.C. 1639.
What is homeowners equity Protection Act?
§ 1024.20,List of homeownership counseling organizations
How to protect equity of my home?
Home Title Lock is one of the services that says it will monitor your home’s deed to prevent title fraud; it costs $15 a month ($150 annually). But you can protect yourself — free — by
When does HOEPA apply?
Examples of Front-line Staff. What are some examples of front-line staff at a bank?
When is HOEPA applicable?
The Home Ownership and Equity Protection Act (HOEPA) was enacted in 1994 as an amendment to the Truth in Lending Act (TILA) to address abusive practices in refinances and closed-end home equity loans with high interest rates or high fees. Since HOEPA’s enactment, refinances or home equity mortgage loans meeting any of HOEPA’s high-cost coverage tests have been subject to special disclosure requirements and restrictions on loan terms, and consumers with high-cost mortgages have had