What does HOEPA stand for?
Home Ownership and Equity Protection Act
What regulation is HOEPA affiliated with?
Regulation Z
Who administers and enforces HOEPA?
Consumer Financial Protection Bureau (CFPB)
What is the purpose of HOEPA? Name two…
- Creates certain protections under TILA for loans with higher interest rates and high fees. This was the first legislation specifically created to combat the practice of predatory lending.; and
- Prohibits certain actions that improperly influence appraisers
What are two other names for HOEPA loans?
Section 32 or High Cost Loans
What is loan flipping?
Loan flipping is the practice of repeated refinancing of a loan within a short period of time.
What is equity stripping?
Making loans based on the amount of equity in a home, without verifying the borrower’s ability to repay (ATR).
When do delivery requirements for HOEPA loans require that disclosures are due?
At least 3 business days prior to closing
Similar to TILA
Loans that fall in the scope of HOEPA loans require additional “disclosure” requirements. Name three of these requirements.
- Special HOEPA Disclosure;
- Notice of balloon payment;
- Amount borrowed;
- Notice of the inclusion of insurance premiums;
- Variable-rate disclosure
