AL MLO cheat sheet

RESPA Section 8 prohibits fees or things of value for referrals of settlement service business; Section 10 limits escrow account deposits to what is reasonably necessary.

TILA/Regulation Z requires disclosure of the APR, finance charge, and amount financed; the APR reflects the cost of credit as a yearly rate.

ECOA/Regulation B prohibits discrimination based on race, color, religion, national origin, sex, marital status, age, or receipt of public assistance income.

HMDA (Regulation C) requires covered lenders to collect and report data on applications, originations, and denials, including applicant race, ethnicity, and sex.

SAFE Act requires mortgage loan originators to be registered or licensed and to include their unique identifier on loan documents.

Flood Disaster Protection Act requires flood insurance for improved property in a Special Flood Hazard Area when the loan is federally related.

HOEPA/Regulation Z high-cost mortgage triggers include points and fees exceeding 5 percent of the total loan amount for loans at or above the threshold.

Fair Housing Act prohibits discrimination in the sale, rental, and financing of dwellings based on protected classes including familial status and disability.

PITI = principal + interest + property taxes + hazard insurance; total housing expense may also add HOA dues and mortgage insurance.

Front-end ratio = monthly housing expense divided by gross monthly income; back-end ratio = total monthly debt divided by gross monthly income.

Conventional loans are not government-insured; FHA, VA, and USDA loans carry federal guarantees or insurance.

Loan-to-value (LTV) = loan amount divided by property value or purchase price, whichever is less; CLTV uses total lien balances.

An amortizing loan retires principal over its term; an interest-only loan has no scheduled principal reduction during the IO period.

Fixed-rate mortgages keep the same interest rate for the full term; adjustable-rate mortgages reset based on an index plus a margin.

Escrow/impound accounts collect property tax and insurance costs monthly and disburse them when due.

A mortgage is a security instrument pledging real property as collateral; the promissory note contains the repayment obligation.

Pre-qualification is an informal estimate of borrowing capacity; pre-approval involves underwriting review of documented income, assets, and credit.

The Loan Estimate must be delivered or placed in the mail within 3 business days of receiving a complete application; the Closing Disclosure at least 3 business days before consummation.

A complete application under Regulation X includes the borrower's name, income, Social Security number, property address, and estimated value.

Ability-to-Repay (ATR) standards require verification of income, assets, employment, credit history, and monthly debt obligations.

Documentation of income includes pay stubs, W-2s, tax returns, and for self-employed borrowers, profit-and-loss statements or business returns.

Credit reports must be obtained from a consumer reporting agency; borrowers have the right to dispute inaccurate information.

Rate lock agreements specify the locked rate, the lock period, and any cost or fee associated with the lock.

Loan file retention and disclosure timing are monitored through the origination process; re-disclosures are required when changed circumstances affect disclosed terms.

Fiduciary duties to clients include loyalty, confidentiality, disclosure of material facts, and acting in the client's best interest.

Confidentiality obligations protect non-public personal information; sharing requires client consent or a legal exception.

Fraud includes intentional misrepresentation of income, assets, occupancy, or property value on a loan application.

Steering borrowers to products based on compensation rather than suitability violates ethical and fair lending standards.

Conflicts of interest must be disclosed; undisclosed referral fees or kickbacks violate RESPA and ethical duties.

Fair dealing requires accurate advertising, no deceptive promises, and clear communication of loan terms and costs.

Anti-money-laundering obligations require reporting suspicious activity and maintaining a customer identification program.

Ethical conduct requires correcting known errors in loan documents or disclosures promptly and accurately.