A creditor receives two appraisals for an HPML as required. The first appraisal shows $400,000 value, the second shows $380,000. The creditor wants to use the higher value for underwriting. What disclosure requirement applies?
Correct Answer
D) Provide both appraisals promptly upon completion, may use higher value
Under TILA Section 1026.35(c)(4), creditors must provide copies of all appraisals and valuations promptly upon completion or three business days before consummation, whichever is earlier. The creditor may use the higher value for underwriting decisions.
Why This Is the Correct Answer
Under TILA Section 1026.35(c)(4), creditors must provide copies of all appraisals and valuations promptly upon completion or three business days before consummation, whichever is earlier. The creditor may use the higher value for underwriting decisions.
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A lender is considering a first-lien mortgage loan with an APR of 5.8% when the current APOR is 4.25%. The loan amount is $150,000 and the property value is $200,000. What additional requirement applies due to HPML status?