A Texas homeowner obtains a home equity loan. The lender sends the required disclosure notice on the same day as the loan application but schedules closing for only 10 days later. Under Texas Constitution Article XVI, Section 50(a)(6)(M), is this closing timeline compliant?
Correct Answer
B) No, because the closing cannot occur before the 12th day after the borrower submits the loan application
Under Texas Constitution Article XVI, Section 50(a)(6)(M), the home equity loan closing cannot occur before the 12th day after the borrower submits the application. A closing at 10 days violates this 12-day pre-closing waiting period.
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RESPA is a federal law that requires lenders to provide borrowers with information about settlement costs, prohibits kickbacks and referral fees, and limits escrow account deposits. It applies to federally related mortgage loans.
The secondary mortgage market is where existing mortgage loans are bought and sold between lenders, investors, and government-sponsored enterprises (GSEs) like Fannie Mae, Freddie Mac, and Ginnie Mae.
TILA is a federal law that requires lenders to disclose the true cost of credit to borrowers, including the annual percentage rate (APR), total finance charges, and loan terms. It is implemented by Regulation Z.
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- → A Texas property owner defaults on both a first mortgage and a second-lien home equity loan. The first mortgage lender forecloses and sells the property at the trustee's sale. Under Texas law, what happens to the second-lien home equity loan?
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A Texas veteran wants to purchase a home using the VLB home loan program. He served in the military for three years and was honorably discharged. Which of the following is required for his VLB loan eligibility?
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A Texas lender forecloses on a home equity loan after the borrower defaults. The foreclosure sale generates $350,000 but the outstanding loan balance including costs is $280,000. Under Texas law, what happens to the $70,000 surplus?