A first-lien mortgage loan is considered a Higher-Priced Mortgage Loan (HPML) under TILA when the APR exceeds the Average Prime Offer Rate (APOR) by what threshold?
Correct Answer
A) 1.5 percentage points
Under TILA Section 1026.35, a first-lien mortgage loan is considered an HPML when the APR exceeds the APOR by 1.5 percentage points or more. For subordinate liens, the threshold is 3.5 percentage points.
Why This Is the Correct Answer
Under TILA Section 1026.35, a first-lien mortgage loan is considered an HPML when the APR exceeds the APOR by 1.5 percentage points or more. For subordinate liens, the threshold is 3.5 percentage points.
More Federal Laws Questions
A mortgage broker's website states 'Qualified borrowers can get loans with down payments as low as 3%.' Which statement about TILA advertising requirements is correct?
A loan's APR increases from 4.25% on the Loan Estimate to 4.35% on the Closing Disclosure due to a rate lock expiration. What action is required?
A lender originates a mortgage that meets all QM requirements. Three years later, the borrower defaults and claims the lender violated the ATR rule. What legal protection does the lender have?
For a closed-end mortgage loan, when must the creditor provide the Closing Disclosure to the borrower?
Which of the following documents must be provided to trigger the start of the 3-day rescission period?
People Also Study
General Mortgage Knowledge
23% of exam
Mortgage Loan Origination Activities
25% of exam
Ethics, Fraud & Consumer Protection
17% of exam
Uniform State Test Content
12% of exam
Previous Question
A borrower mentions they are looking for a home in a 'family-friendly neighborhood with good schools' because they have young children. The MLO suggests several areas but avoids mentioning a particular neighborhood because it has a high concentration of elderly residents. This action is:
Next Question
Which of the following properties would NOT be subject to mandatory flood insurance requirements under the Flood Disaster Protection Act?