Trigger terms are words or phrases, whether positively or negatively mentioned (e.g., “no annual fee”), that prompt additional regulatory disclosures in the headline, subhead, and/or disclosure of the advertisement to clarify the credit costs and terms that are being promoted.
What are trigger terms under Regulation Z?
Triggering terms need not be stated explicitly; additional disclosures are still required if the term may be readily determined from the advertisement. For example, if the advertisement says “80 percent financing available,” the statement is indicating a 20 percent down payment is required (a triggering term).
What is a triggering term for advertising purposes?
Definition. A triggering term is a word or phrase that legally requires one or more disclosures when used in advertising. Triggering terms are defined by the Truth in Lending Act (TILA) and are designed to protect consumers from predatory lending practices.
What is a loan trigger?
A trigger event is a particular situation that prompts a chain of events relating to a loan or contractual agreement to pay money in exchange for equity. Trigger event clauses are common in convertible notes, SAFEs and loan documentation.
What is considered a trigger term? – Related Questions
What are examples of trigger terms?
The triggering terms are:
- The amount of the down payment, expressed either as a percentage or as a dollar amount.
- The amount of any payment expressed either as a percentage or as a dollar amount.
- The number of payments.
- The period of repayment (the total time required to repay).
- The amount of any finance charge.
What is not a triggering term?
On the other hand, some terms or phrases do not trigger additional disclosures. Examples include, financing available, low or no down payment, easy monthly payments, pay weekly, and terms to fit your budget.
What is a trigger event in banking?
A trigger event may identify a suspicious activity. In the event that this occurs the member of staff who has identified the suspicious trigger event must raise an internal report as per the firm’s internal procedures.
What are trigger terms for Helocs?
You may be wondering what terms might trigger these additional disclosures.
- Late payment and over-the-limit fess;
- Charges imposed in connection with real estate transactions, such as title, appraisal, and credit report fees;
- Taxes imposed by a state or other governmental body; and.
- Charges to terminate the plan.
What violates the Truth in Lending Act?
Some examples of violations are the improper disclosure of the amount financed, finance charge, payment schedule, total of payments, annual percentage rate, and security interest disclosures. Under TILA, a creditor can be strictly liable for any violations, meaning that the creditor’s intent is not relevant.
What is a triggering term quizlet?
Triggering terms. Phrases or figures used in advertising that will “trigger” other Regulation Z disclosures. The following are trigger terms: the amount or percentage of any down payment, the payment period, the monthly payment, and the amount of the finance charge.
Is a teaser rate a trigger term?
B is incorrect because a teaser rate is a trigger term. C is incorrect because if you state that the loan may exceed the Fair Market Value of the dwelling the advertisement must also state that the interest on the portion of the extension that is greater than the fair market value is NOT tax deductible.
Which of the following is a trigger term for advertisements for both open end and closed end mortgage loans?
Which of the following is a trigger term for advertisements for both open-end and closed-end mortgage loans? A. The answer is finance charge. The finance charge is a trigger term in advertising for both open- and closed-end loans.
Which of the following is not a requirement for an FHA loan?
Which of the following is NOT a requirement for someone applying for an FHA loan? You chose not to answer this question. Correct Answer: No history of bankruptcy or foreclosure. The FHA requires borrowers to have no foreclosures in the past three years, and no bankruptcies in the past two years.
What fails an FHA inspection?
Structure Quality. The overall structure of the property must be in good enough condition to keep its occupants safe. This means severe structural damage, leakage, dampness, decay or termite damage can cause the property to fail inspection. In such a case, repairs must be made in order for the FHA loan to move forward.
What is an alienation clause?
An alienation clause, also known as a due-on-sale clause, is a real estate agreement that requires a borrower to pay the remainder of their mortgage loan balance off immediately during the sale or transfer of a property title and before a new buyer can take ownership.
What do FHA inspectors look for?
Checklist of FHA appraisal requirements
Must have an undamaged exterior, foundation and roof. Must have safe and reasonable property access. Must not contain loose wiring and exposed electrical systems. Must be free from damaged underground storage tanks and soil contaminants.
What will fail a home appraisal?
Anything from deferred maintenance on the home to cool market conditions can lower a home appraisal. Recent sales in the neighborhood will help determine the market value of the home. So if sales have been slow, or if sellers have been accepting lower offers, the value of all homes in the area can be affected.
Why would a seller not want an FHA loan?
The other major reason sellers don’t like FHA loans is that the guidelines require appraisers to look for certain defects that could pose habitability concerns or health, safety, or security risks. If any defects are found, the seller must repair them prior to the sale.
How long do you have to keep a house with an FHA loan?
FHA loans are for owner-occupied property only. You must move into the property within 60 days of closing a purchase, and must occupy the property for at least one year. After that, you can change how you use the property.
What is the FHA 100 mile rule?
Job Relocation and FHA 100 Mile Rule
The FHA 100 mile rule allows a buyer to retain their FHA loan on their prior residence and finance another home with another FHA mortgage. In order to obtain another FHA mortgage without selling the other home, the buyer must: Relocate for an employment-related reason.