The various federal and state laws and regulations, along with the ethical standards established by industry associations, define the minimum level and type of conduct that mortgage practitioners should engage in. The following are the minimum legal and ethical laws and standards that those engaged in mortgage practice must comply with:

• The Fair Credit Reporting Act (FCRA) sets forth requirements for credit reporting and creditworthiness of borrower applicants.

• The Home Ownership and Equity Protection Act (HOEPA) requires specific disclosures on loans with annual percentage rates (APRs) more than 6.5 percentage points above the average prime offer on first liens, and more than 8.5 percentage points above the average prime offer rate (APOR) on subsequent liens. (Originally, HOEPA covered first-lien loans with 8 percentage points above APOR and second-lien loans with 10 percentage points above APOR. This was adjusted by the CFPB to 6.5 and 8.5 as of January 2014.)

• The Equal Credit Opportunity Act (ECOA) and its Regulation B prohibit discrimination against loan applicants on the basis of race, color, religion, national origin, sex, marital status and age.

• The Fair Housing Act is a series of federal laws that prohibits discrimination in the sale, rental, or financing of residential housing relating to the seven protected classes of individuals based on race, color, religion, national origin, sex, familial status, or disability (mental or physical).

• Regulation C: Home Mortgage Disclosure Act (HMDA), 12 CFR 1003, requires that specific information be made available to the public when mortgages are sold on the secondary market.

• Regulation Z: Truth in Lending Act (TILA), 12 CFR 1026, requires disclosure of loan terms and percentage rates in a form that makes it easier for a consumer to compare competing loan products

• Regulation X: Real Estate Settlement Procedures Act (RESPA), 12 CFR 1024, requires the disclosure of fees and costs involved when closing home mortgages and prohibit abusive settlement practices.

• The Ability-to-Repay (ATR) and Qualified Mortgage (QM) rules and regulations require that mortgage loan originators and mortgage brokers follow specified rules to verify that the borrower has the ability to repay the loan applied for. If the Qualified Mortgage rules are complied with, the mortgage broker and mortgage loan originator are provided a save harbor against borrower lawsuits. These rules encourage diligent verification and qualification of a borrower's ability to repay the loan and minimize the risk of default and foreclosure.

• The loan originator compensation rules are designed to limit loan originator compensation and the total costs associated with originating a mortgage loan product to fall within predefined statutory limits. The purpose is to prohibit excessive fees and related abusive practices.