A mortgage company's billboard displays 'Refinance and save! Payments starting at $999 per month on loans up to $200,000.' What makes this advertisement non-compliant with TILA?
Correct Answer
C) It states a payment amount without disclosing the APR
Under TILA Regulation Z Section 1026.24, stating a specific payment amount ('$999 per month') is a triggering term that requires disclosure of the APR. The loan amount mentioned ($200,000) is not itself a triggering term, but the payment amount triggers the APR disclosure requirement.
Why This Is the Correct Answer
Under TILA Regulation Z Section 1026.24, stating a specific payment amount ('$999 per month') is a triggering term that requires disclosure of the APR. The loan amount mentioned ($200,000) is not itself a triggering term, but the payment amount triggers the APR disclosure requirement.
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?
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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?
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A borrower mentions they will be receiving a large inheritance of $75,000 next month to help with the down payment, but they cannot provide documentation because 'the estate is still in probate.' This statement alone would most likely trigger which BSA/AML consideration?
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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?