How often must lenders conduct escrow account analyses?
Correct Answer
C) Annually
RESPA requires lenders to conduct escrow account analyses at least once per year (annually) to determine if there are shortages or surpluses in the account.
Why This Is the Correct Answer
RESPA requires lenders to conduct escrow account analyses at least once per year (annually) to determine if there are shortages or surpluses in the account.
More Mortgage Knowledge Questions
A borrower is comparing two loan offers: Loan A has no points and 4.5% interest rate, Loan B has 2 points and 4.0% interest rate. The loan amount is $400,000. How much will the borrower pay upfront for the points on Loan B?
A lender charges a 1% origination fee on all loans. For a borrower obtaining a $250,000 mortgage, what is the maximum origination fee that can be charged without violating the points and fees test under the ATR/QM rule for a first-lien mortgage?
Under what circumstances can a Qualified Mortgage include a prepayment penalty?
A borrower is considering paying discount points to reduce their interest rate. Each point costs 1% of the loan amount and reduces the rate by 0.25%. On a $300,000 loan, how much would the borrower pay for 2 discount points?
A borrower asks about the difference between discount points and origination fees. What is the most accurate explanation?
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Previous Question
A borrower has a 5/1 ARM with a 2/2/5 cap structure and a start rate of 3.5%. After the first adjustment, the fully indexed rate is 7.8%. What is the maximum rate the borrower can be charged at the first adjustment?
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A borrower has an interest-only mortgage with a 10-year interest-only period followed by a 20-year amortization period. If the original loan amount was $400,000 at 5% interest, what will be the approximate monthly payment during the amortization period, assuming no principal payments were made during the interest-only period?