Within our online mortgage courses are many legal citations. Each citation refers to a federal or state law or rule that is the source for the material being explained. During your mortgage education you may occasionally want to go directly to a law or rule for more information.
There is a difference between a law and a rule. On the state level, laws, also known as statutes or sometimes code sections, are made by the state legislature. Rules or regulations in support of the laws are typically written by a state government office that enforces the law, like the Banking or Motor Vehicle Divisions.
On the federal level, the U.S. Congress makes laws which are contained in the U.S. Code. These laws are often written broadly. Federal agencies write the supporting regulations that make the laws useful. The regulations add to the law clarity and detail, as well as operating procedures, interpretative clauses, timelines, penalties and so on. Federal regulations are found in the Code of Federal Regulations.
In the mortgage industry, a number of federal laws are in play, including TILA, the Fair Credit Reporting Act, the SAFE Act and more. Federal mortgage related regulations are written by agencies such as HUD and the Board of Governors of the Federal Reserve. Soon, regulations will be coming from the Bureau of Consumer Financial Protection. In addition, each state has its own mortgage laws, and its own related rules or regulations for enacting, enforcing and interpreting the mortgage laws.
Let's look at an example of ProSchools' legal citations to demonstrate how you can directly access the law or regulations through the Internet: In our 20-hour SAFE Comprehensive mortgage course, there is a section titled "Scope of RESPA." Under the title is this citation: (Reg X 3500.2(b) and 3500.5). We want to look directly at this regulation to learn more.
First, note that RESPA is a federal law. Federal laws are found in the U.S. Code and are formally cited as "U.S. Code" or "U.S.C." followed by a section sign (§) or the word "section" and the section number (12 U.S.C. §2601) . In informal usage, the writer may skip any mention of a section, as we do here.
From reading the lesson you'll know that Regulation X is the rule that implements RESPA. The first part of the citation (Reg X 3500.2(b)) refers to subsection .2(b) of section 3500 of Regulation X.
Regulation X is easy to search for in Google. In fact, it's such an important regulation that it's almost too easy to find, with links to all kinds of related material. Browse the Google list for "Regulation X 3500" and you'll find the section you're looking for. Here are two links that will come up in the search:
http://law.justia.com/us/cfr/title24/24-5.1.3.1.4.html
http://www.fdic.gov/regulations/laws/rules/6500-2520.html
These links take you to Section 3500 of Title 24, Code of Federal Regulations, formally cited as "24 CFR 3500," and titled "Real Estate Settlement Procedures Act." This CFR section is also known as Regulation X.
These links also take you to the most convenient way to access a regulation, a table of contents with links to subsections. At these tables of contents, you can find the subsections in our citation: 3500.2(b) and 3500.5. Subsection 3500.2(b) contains definitions and 3500.5, titled "Coverage of RESPA," carries the full text describing RESPA's coverage (or scope). Now you can compare the rule to our course content.
This same exercise may be performed to look for a state law or regulation. By searching in Google using the citiations in the course, you'll be able to access the law or regulation yourself. You can also go to a state's legislative website and find statutes and rules.
Though not a required part of your mortgage training, being able to find the law or rule behind your mortgage licensing or compliance requirements can enhance your self-education as you continue in your career.