What does the acronym HPA stand for?

Study for the CFPB Mortgage Compliance Test. Learn with detailed quizzes and flashcards. Understand the key concepts, regulations, and guidelines with comprehensive explanations. Get ready to ace your exam!

The acronym HPA stands for the Homeowners Protection Act. This legislation was enacted to provide certain protections to homeowners from the automatic termination of private mortgage insurance (PMI) when specific conditions are met. Understanding this act is crucial for compliance in mortgage lending because it ensures that borrowers are not charged for PMI longer than necessary, which can help them save money over the life of their loan.

The Homeowners Protection Act outlines the guidelines for when and how PMI can be canceled by the lender and stipulates that homeowners must be communicated with clearly regarding their rights and the applicable criteria for terminable insurance coverage. This act is central to ensuring ethical lending practices and safeguarding consumer interests in the mortgage industry.

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