Exam 31: Mortgages Foreclosures After the Recession

Lorna borrows $175,000 from Mountainside Credit Union to buy a home.Among the terms that must be disclosed under federal law is the annual percentage rate.This is

Due to a lower default rate,lenders charge a lower interest rate for subprime loans.

Fact Pattern 31-1A (Questions A12-A14 apply) 24-Hour Credit Corporation issues high-cost and high-fee mortgage products to people,including Benny,who could not easily obtain credit under other loan programs. -Refer to Fact Pattern 31-1A.Under federal law,disclosures with respect to one of 24-Hour Credit's loans must be provided

Foreclosure is the postponement,for a limited time,of part or all of the payments on a loan in jeopardy of repossession and sale.

For most purposes,a mortgage assignee of a high-cost or high-fee mortgage product does not acquire the status of a holder in due course.

There are additional disclosure requirements for a higher-priced mortgage loan.

Darwin borrows $200,000 from Evermore Bank to buy a home.Less than six months into the term,Darwin stops making payments on the loan.To initiate the process to repossess and auction off the property securing the loan,Evermore must

Milo borrows $125,000 from North State Bank to buy a home.To comply with the Statute of Frauds,the mortgage must be

Main Street Lenders,Inc.,attempts to coerce Nolan-who specializes in determining the value of real and personal property-into misstating the value of a property on which a loan is to be issued.This is

Consumer Mortgage Loans provides Demi with a mortgage to buy a home.Under the terms,Demi can choose to pay only the interest portion of the monthly payments and forgo paying of the principal for five years.This is

With an adjustable-rate mortgage,the rate of interest paid by the borrower changes periodically.

Velma borrows $110,000 from Watershed Bank to buy a home.If she fails to make payments on the mortgage,the bank has the right to repossess and auction off the property securing the loan.This is

The loan that a lender provides to enable a borrower to purchase real property is a mortgage.

A lender can make a higher-priced mortgage loan based on the value of the consumer's home without verifying the consumer's other credit obligations.

Harbor Bay Bank has made mortgage loans to consumers that qualify for the Home Affordable Modification Program (HAMP),which offers incentives to lenders to change the terms of certain loans.The purpose of HAMP is to

A fixed-rate mortgage is a standard mortgage with a rate of interest that changes periodically.

The initial interest rate is the part of a purchase price that is paid up front in cash.

Kim's home is valued at $250,000.Kim has paid the mortgage-she has 100 percent equity in the property.She wants to start a new business with Lloyd.To obtain funds,Kim refinances the loan through Metro Bank,borrowing $200,000 for fifteen years at an interest rate of 4.85 percent.Before the loan is completed,Metro provides Kim with all of the required disclosures.On the day of the loan,a fifteen-year Treasury bond is yielding 2.85 percent.Kim pays $7,500 in fees to the bank.Less than a month later,she sells her interest in the new business to Lloyd and wants to rescind the loan.Which federal law covers this loan-TILA,HOEPA,HPML,or HAMP? Can Kim rescind the deal? Explain.

Hubert borrows $100,000 from Integrity Mortgage Mart to buy a home.Soon after obtaining the mortgage,Integrity convinces Hubert to refinance.This is

A borrower has a right to rescind a mortgage within three business days.