SAFE 3rd 115
A borrower is placing a down payment of 15% on a 30-year FHA mortgage. For how long will the borrower pay MIP? 30 years For the life of the loan 11 years 5 years
11 years
Per ECOA record retention rules, how many months should the information be maintained from the date the borrower was notified of credit action? 12 36 25 24
25
For a FNMA, 90% fixed loan, the generally accepted qualifying ratios are what? 29%/41% 28%/36% Only a back-end ratio of 41% 31%/43%
28%/36%
Minimum educational requirements under the SAFE Act include all of the following, EXCEPT? 3 Hours Federal Law 2 Hours Nontraditional Mortgage Products 3 Hours Ethics 3 Hours State Law
3 Hours State Law
According to TILA, a mortgage broker needs to provide the borrower with the Loan Estimate within how many days of completed application if they are mailing it? 3 days 10 days 3 business days 7 business days
3 business days
Which loan will never have mortgage insurance? A 90% LTV Freddie Mac mortgage loan A 100% LTV VA loan FHA loan with less than 80% LTV A 85% LTV Conventional loan
A 100% LTV VA loan
Which federal law regulates credit reporting agencies like Experian, Equifax and Transunion and requires a creditor that denies credit to a borrower to provide access to a free credit report for a denial? Equal Credit Opportunity Act USA Patriot Act Truth In Lending Act Fair Credit Reporting Act
Fair Credit Reporting Act
Redlining is a violation of both: ECOA and HMDA Fair Housing Act and ECOA Community Reinvestment Act and HMDA Fair Housing Act and HMDA
Fair Housing Act and ECOA
A mortgage product that does not allow for a modification of the annualized rate of interest is BEST described as which of the following? Variable rate mortgage Collateralized mortgage obligation Shared appreciation mortgage Fixed rate mortgage
Fixed rate mortgage
The Total Interest Percentage (TIP) is found on what two disclosures? Loans Estimate and Intent to Proceed Loan Estimate and Closing Disclosure Closing Disclosure and ABA Right to Cancel TIP and TIP initial statement
Loan Estimate and Closing Disclosure
Which of the following accurately portrays a loan-to-value calculation? Loan amount divided by the lesser of property value or sales price Property value or sales price divided by loan amount Property value or sales price multiplied by loan amount Loan amount multiplied by property value or sales price
Loan amount divided by the lesser of property value or sales price
A mortgage loan originator's NMLS number must be placed on which of the following types of advertisements and documents? Loan applications, business cards, and coffee mugs Loan applications, websites, radio ads, and clothing Business cards, radio ads, websites, and stationary Loan applications, business cards, and websites
Loan applications, business cards, and websites
The most common appraisal form used in the industry and is generically referred to as a "full" appraisal is called what form? 1099 1004 4506 1003
1004
Sam the shoemaker has been in his profession for 15 years. Being that his work hours are based on the amount of business and not a set schedule, he averages 37.5 hours per week. His boss has agreed that after he hits 40 hours, he will receive a 15% overtime differential. Since business has been slower for the past few years, he has fallen short of the overtime bonus and has remained at $15.00 per hour. What is his average gross monthly income we could use to qualify him for a mortgage? $2,803.12 $2,437.50 $2,600.00 $562.50
$2,437.50
According to ECOA, if a group of borrowers wish to sue a lender through a class action lawsuit, what is the maximum penalty that can be assessed to a lender? $100,000 in actual damages and up to $10,000 in punitive damages $500,000 or 1% of the creditor's net worth, whichever is less $500,000 or 1% of the creditor's net worth, whichever is greater $500,000 or 10% of the creditor's net worth, whichever is less
$500,000 or 1% of the creditor's net worth, whichever is less
Mortgage fraud is investigated by the Federal Bureau of Investigation and is punishable up to what amount of fine or prison time or both? 25 years in federal prison and a $1,000,000 fine or both 30 years in federal prison or a $1,000,000 fine or both 20 years in federal prison and a $1,000,000 fine or both 30 years in federal prison and a $1,000,000 fine
30 years in federal prison or a $1,000,000 fine or both
A couple is purchasing a home that has a price of $215,000 and the appraised value is $200,000. They will take out a 1st mortgage in the amount of $150,000 and $50,000 for their 2nd mortgage. What is their LTV? 70% 100% 75% 69%
75%
Leah has applied for a refinance on her property, which has been valued at $235,000. She currently has a home equity line of credit with a $47,000 maximum limit, and she owes $25,850. She has applied for another mortgage of an additional $164,500. Using this information, what is Leah's HCLTV? 81% 100% 70% 90%
90%
What would the CLTV be for a transaction where the purchase price of the home is $165,000 and the appraised value is $154,000. The buyer is applying for a 1st mortgage in the amount of $123,200 and the seller is providing a seller carryback loan in the amount of $15,400. 89% 80% 95% 90%
90%
According to RESPA, which of the following payments are acceptable? A referral fee paid to a licensed mortgage broker who could not originate the loan in the state. A referral fee paid to a licensed real estate agent who actively seeks individuals searching for mortgage loans. A fee paid to someone equal to their percentage of ownership in the affiliated business. A fee paid to an insurance agent for referring insurance customers who need a mortgage loan.
A fee paid to someone equal to their percentage of ownership in the affiliated business.
Marquez the MLO is trying to qualify a client for a mortgage loan. After getting the necessary information, Marquez lets the client know they qualify for a loan. The loan the client qualifies for has an APR that coincides with the requirements set forth in Section 35 of TILA. Which of the following loans would fall into this category? A first lien mortgage with an APR that is 2% higher than the APOR A first lien jumbo with an APR that is 2% higher than the APOR A subordinate lien with an APR that is 3% higher than the APOR A first lien mortgage with an APR that is 1% higher than the APOR
A first lien mortgage with an APR that is 2% higher than the APOR
Which of the following would result in a violation of the CFPB's Regulation X? A lender intentionally advertising an interest rate without disclosing the APR on a website. A lender receiving funds from a settlement service provider for a business referral. A lender fails to provide an affiliated business arrangement when the borrower selects their own settlement service provider. A lender accidently advertising an interest rate without disclosing the APR in a radio advertisement.
A lender receiving funds from a settlement service provider for a business referral.
Foreclosure is BEST defined as which of the following? A legal remedy for extinguishing all of the debtor's encumbrances A legal procedure for satisfying claims against a lender who acted improperly A proceeding to distinguish all rights, title, and interest of the owners of a property in order to sell the property to satisfy a lien against it A loan which has been outstanding for a period of time
A proceeding to distinguish all rights, title, and interest of the owners of a property in order to sell the property to satisfy a lien against it
Which of the following BEST describes an immediate family member? A spouse, child, sibling, parent, grandparent, great-grandparents, grandchild, stepparent, stepchild, stepsibling, adoptive relationship A spouse, child, sibling, parent, grandparent, grandchild, stepparent, stepchild, stepsibling, adoptive relationship A spouse, child, sibling, parent, grandparent, grandchild, stepparent, stepchild, stepsibling, cousin A spouse, child, sibling, parent, grandparent, grandchild, adoptive relationship
A spouse, child, sibling, parent, grandparent, grandchild, stepparent, stepchild, stepsibling, adoptive relationship
According to TILA, if an advertisement for a specific loan states a payment amount, it also must include: Term of the loan Finance Charge Number of payments All of the choices
All of the choices
Eric is a broker who has had his own brokerage business for a couple years. In order to make sure he stays current on mortgage fraud trend, he routinely runs a self-test within his company. Quality control measures are required by which of the following laws? Regulation B Regulation V GLBA All of the choices
All of the choices
Repayment of a mortgage debt with equal periodic payments of both principal and interest, calculated to retire the obligation at the end of a fixed period of time." Which of the following terms BEST encompasses the preceding definition? Amortization Commitment Points Entitlement
Amortization
A borrower gives you their income and debt and asks what amount of loan they qualify for. Assuming you have decided which loan program best fits their needs, to calculate what loan amount they are able to repay you would need to know all of the following items, EXCEPT? Interest rate for the loan program Amount of cash available to close Front and back ratios for the loan program Taxes and insurance portion of the PITI payment
Amount of cash available to close
The minimum down payment for FHA loans is 3.50% of the lesser of which? Purchase price and appraised valued Purchase price minus seller concessions Appraised value plus seller concessions Appraised value or purchase price
Appraised value or purchase price
A mortgage loan originator is prohibited from engaging in all of the following interactions within the appraisal process, EXCEPT? Offering an appraiser additional compensation for a higher value Asking an appraiser to consider the purchase price when determining the value Sending referrals to an appraiser who meets expected values Asking an appraiser to consider appropriate property information
Asking an appraiser to consider appropriate property information
When a Power of Attorney is executed it creates a legal relationship between the person signing and their authorized agent. The authorized agent is also commonly referred to as which of the following? Court-appointed fiduciary Principal author Attorney-in-fact Beneficiary
Attorney-in-fact
When David the loan originator begins working on Harold's loan application, he asks Harold for all of his long term debt. This allows David to use all of this information and also include the proposed PITI payment in order to calculate Harold's what? Front-end ratio Margin Back-end ratio Index
Back-end ratio
What information is always found on a credit report? Correct Social Security numbers All credit accounts and payment histories for the last 5 years Previous income and employment Borrower's name and address
Borrower's name and address
Karen and Daniel have decided to list their home for sale. They have called on Randy the Realtor to come in and list the house. Randy has put together a proposal of a sale price for the home. He believes that by looking at the three most recent sales of homes in the area, as well as those listed, that the house should sell for around $250,000. Randy's opinion of value was based off of? Cost approach to value Direct sales comparison approach Market approach to value Broker's price opinion
Broker's price opinion
"A limit on how much the interest rate or monthly payment can change, either at each adjustment or during the life of the mortgage." Which of the following terms best represents the preceding definition? Cap Index Principal Margin
Cap
Which of the following may never be used for closing costs and down payment with FHA loans? Bridal registry funds Cash advance on a credit card Gift funds 401k loan
Cash advance on a credit card
The Fair Housing Act is an amendment to which of the following? Equal Credit Opportunity Act Consumer Credit Protection Act Housing for Older Persons Act Civil Rights Act of 1968
Civil Rights Act of 1968
The Truth In Lending Act (TILA or Regulation Z) regulates which of the following disclosure requirements? Closing Disclosure, Adjustable Rate Disclosures, Right to Receive Credit Score Closing Disclosure, Notice of Right to Receive an Appraisal Report, Right to Cancel PMI Closing Disclosure, Right of Rescission, CHARM Booklet Closing Disclosure, HUD-1, GFE
Closing Disclosure, Right of Rescission, CHARM Booklet
Service Release Premium can best be described as: Calculated in the interest rate Same as Yield Spread Premium Compensation paid to represent the value of the servicing rights for a loan None of the choices
Compensation paid to represent the value of the servicing rights for a loan
"The required element of all contracts by which a legal right or promise is exchanged for the act or promise of another person." Which of the following terms is correct based on the preceding definition? Consideration Certificate of Eligibility Easement Interest
Consideration
A borrower wants to buy an investment property. He has a credit score of 700 and is a veteran. He is also looking to put as little down as possible. What type of loan should he use? Reverse Mortgage VA FHA Conventional
Conventional
HMDA was passed in Congress in response to a public concern over what? Discrimination against elderly Americans being unacceptable credit risks for 30 year loans Refusal of some lending institutions to lend on certain types of property Credit shortages in certain urban neighborhoods None of the choices
Credit shortages in certain urban neighborhoods
When a mortgage broker acts as an agent for a bank in connection with a mortgage loan, the bank may delegate to the broker the obligation to perform the requirements of the bank's CIP rule. Relating to the Patriot Act, CIP is an acronym for which of the following? Custom Insurance Program Customer Investment Program Customer Investigation Program Customer Identification Program
Customer Identification Program
Donald contacts Mega Mortgage, a non-depository lender, regarding a refinance of the property he has lived in for the past 7 years. During the application process, Donald informs the mortgage loan originator that he is not a borrower or co-signer on the current mortgage, but that he has been making the payments on the mortgage for the past 7 years on behalf of his elderly mother and wishes to be added to the new loan and also to the title. When the MLO requests to speak with Donald's mother, Donald mentions that his mother is not physically or mentally capable of participating in the refinance. What should the MLO do? Request that Donald provide a Power of Attorney executed by himself Determine whether or not Donald has valid authority to continue with the loan File a Suspicious Activity Report with FinCEN Nothing, Donald has an implied ownership interest due to living in the home for more than 5 years
Determine whether or not Donald has valid authority to continue with the loan
"A clause in a mortgage that states that if a mortgagor sells, transfers, or in any way encumbrances the property then the mortgagee has the right to implement a clause making the balance of the obligation due." Which of the following terms is correct based on the following definition? Acceleration Clause Due on Demand Clause Prepayment Due-On-Sale Clause
Due-On-Sale Clause
The scope of which regulation is to ensure that various financial institutions and other firms engaged in the extensions of credit exercise their responsibility to make credit available with fairness, impartiality, and without discrimination based on the basis of sex or marital status? ECOA RESPA FACTA HMDA
ECOA
Two minority loan applicants were told it would take several hours and require the payment of an application fee upfront to determine if they would qualify for a home mortgage loan and more than likely they will end up not qualifying anyway. Which law is being violated in this scenario? FACTA HMDA ECOA RESPA
ECOA
Which of the following is most correct? Each licensee must appear before the Bureau and give relevant testimony when summoned. Each licensee must appear before the legislature and produce any data when requested. No licensee is obligated to appear before the Bureau when summoned. Licensees may not appear before the Bureau and produce any records when summoned.
Each licensee must appear before the Bureau and give relevant testimony when summoned.
"A sum of money given to bind the sale of real estate." Which of the following terms best represents the preceding definition? Valuation Down Payment Impound Fund Earnest Money
Earnest Money
"The legal right that gives someone, other than the owner, access to the use of a property for specific purpose." Which of the following terms BEST represents the preceding definition? Asset Easement Consideration Entitlement
Easement
Which imposes restrictions on lenders regarding the use of nonpublic personal information? Gramm-Leach-Bliley Act Real Estate Settlement Procedures Act Fair Credit Reporting Act Fair Housing Act
Gramm-Leach-Bliley Act
Which initial disclosure does RESPA require the mortgage broker to provide to the borrower within 3 business days after the completed loan application, if mailed? Initial Escrow Statement Homeownership Counseling Organizations List Initial Privacy Policy Initial Rate Adjustment
Homeownership Counseling Organizations List
Jim has obtained approval for financing through Layla's Loan Shop. Jim puts an offer on a home. The seller refuses the offer due to concerns with the lender's ability to close the loan by the scheduled closing date. Which of the following laws is the seller violating? RESPA ECOA FHA None of the choices
None of the choices
A borrower has an adjustable rate mortgage with the first year P&I payment of $2,259. Eight years later the P&I payment is $2,816. What best describes what happened? Margin changed Index value increased Loan was recast Adjustment cap was not exceeded
Index value increased
Who bears the responsibility of renewing a mortgage loan originator license if the licensee is employed by a mortgage lender? Mortgage loan servicer Mortgage lender Mortgage broker Individual mortgage loan originator
Individual mortgage loan originator
According to TILA finance charges can be which of the following? Interest + Mortgage Insurance + Prepaid Finance Charges Interest - Mortgage Insurance Escrow + Prepaid Finance Charges Interest - Mortgage Insurance Escrow - Prepaid Finance Charges Interest + PMI - Prepaid Finance Charges
Interest + Mortgage Insurance + Prepaid Finance Charges
Why is it important for a client to know an affiliation between an LO and a settlement service exists? It allows the client to know they are able to shop around for this service, but this affiliation does include an extra fee due to convenience. It allows the client to know they are able to shop around for this service and this affiliation does not include any extra fees or unearned costs. It informs the client the provider must be chosen within 3 business days. It informs the client the affiliated service is the only option and must be chosen.
It allows the client to know they are able to shop around for this service and this affiliation does not include any extra fees or unearned costs.
Why is the APR not the same as an interest rate? It factors in all the time and prepaid finance charges. It represents the annualized interest rate. It factors in the interest and other prepaid finance charges. It annualizes all closing costs.
It factors in the interest and other prepaid finance charges.
John, a loan originator for ABC Lending, delivered all the necessary initial disclosures to his client Mr. Thomas. The documents were delivered electronically, and the expectation was for Mr. Thomas to e-sign his documents. Mr. Thomas was made aware of the hardware and software requirements prior to receiving the documents, but John's company made technology changes to this process prior to delivery of the documents. What must John do? John must provide an additional disclosure to his client stating that he has the right to receive the signed agreement in paper form. John must notify his client of any hardware or software requirements due to the technology change. John should have the client sign a paper form and an electronic copy. John should do nothing, even if the hardware or software requirements have changed.
John must notify his client of any hardware or software requirements due to the technology change.
What three federally required disclosures must be provided within 3 business days of a receipt of a loan application by a mortgage broker for a purchase money loan? LE, Homeownership Counseling Organizations List, Home Loan Toolkit GFE, MSDS, Notice of Transfer TIL, CD, ABA LE, CD, MSDS
LE, Homeownership Counseling Organizations List, Home Loan Toolkit
Fannie Mae and Freddie Mac's underwriting guidelines require you, the MLO, to ensure the applicant meets which of these specific standards? Two appraisals to ensure collateral value be considerable enough to sell for indemnification. Maximum loan amounts that coincide with city covenants from the following year's restituted budget. Capacity limitations of no less than 36% for either of the two ratios being examined. Loans where the initial principal balance fails to exceed applicable loan limits in areas where such limits are allowable.
Loans where the initial principal balance fails to exceed applicable loan limits in areas where such limits are allowable.
"The unpaid interest which is added to the mortgage principal in a loan where the principal balance increases rather than decreases because the mortgage payments do not cover the full amount of interest due." Which of the following terms BEST represents the preceding definition? Fee simple Impound fund Deficiency Negative amortization
Negative amortization
When must a mortgage broker provide a Notice of Action Taken to an applicant? No later than 3 days after an incomplete credit application No later than 30 days after the initial conversation with the borrower No later than 24 hours after application No later than 30 days after receipt of completed application for credit
No later than 30 days after receipt of completed application for credit
Does everyone with ownership interest sign the promissory note? Yes, anyone who is on the deed must also sign the note. Yes, everyone involved with the transfer of ownership must sign the note. No, the note doesn't need a signature by anyone, whether they are on the loan or not. No, only those parties that are on the loan must sign the note.
No, only those parties that are on the loan must sign the note.
In accordance with the guidelines of Fannie Mae, all of the following are considered to be "security instruments", EXCEPT? Note Deed of trust Trust deed Mortgage
Note
"A limit on the amount a payment can be changed at the end of each payment adjustment period. It can be a percentage of the previous payment, a fixed dollar amount, or a specified change in the interest rate of which the payment was calculated. It does not have to be the same as an interest rate cap." Which of the following terms best represents the preceding definition? Margin Lifetime cap Payment buydown Payment cap
Payment cap
Which of the following is NOT a violation of RESPA? Charging the consumer more than the actual cost for services provided by third parties A referral fee given to or received from a third party Charging fees to a consumer for services not provided Payment for services actually rendered and in an amount consistent with the reasonable value of such services
Payment for services actually rendered and in an amount consistent with the reasonable value of such services
Which of the following BEST describes a lender rebate? Payment made to a broker for originating a loan Payment made by a lender when originating a loan with a higher than market interest rate which is used to offset costs for the borrower Payment made to a broker to offset operational costs associated with creating a loan Payment made by a lender when purchasing an adjustable rate loan
Payment made by a lender when originating a loan with a higher than market interest rate which is used to offset costs for the borrower
Prepaid Finance Charges include all of the following, EXCEPT? Pest Inspection Discount Points Origination Charge Mortgage Insurance
Pest Inspection
When a mortgage broker willfully misleads a borrower in order to increase their profit, this is called what? Redlining Allowable compensation Predatory Lending None of the choices
Predatory Lending
Which fee is not allowed to be charged to the borrower in an FHA loan? Origination fee Processing fee Appraisal fee Attorney fee
Processing fee
Which of the following interactions with an appraiser would be considered appropriate? Providing the sales contract to help ensure the appraiser has pertinent information regarding the property Threaten to have their name removed from the acceptable appraiser list with your company Ask the appraiser to use pre-selected comparables Offer the appraiser several appraisal jobs if she can get this one to work
Providing the sales contract to help ensure the appraiser has pertinent information regarding the property
Lenders are not allowed to provide the appraiser with any of the following, EXCEPT? Purchase contract Projected estimates of value Recent comparables Real estate agent's estimate of value
Purchase contract
A borrower has a right to cancel certain transactions in writing by midnight of the third business day following the later of the consummation of the transaction or delivery of notice of the right to cancel. The "cooling off" period between closing and the time that funds are disbursed is called what? Adverse Action Right of Rescission Interim Period Right of Redemption
Right of Rescission
A residential mortgage loan is a loan for personal, family, or household use that is secured on a dwelling by a voluntary contract. Which of the following will not secure an interest in the property for a residential mortgage loan? Sales contract Mortgage Deed of trust Junior deed of trust
Sales contract
The person who prepares the closing disclosures and helps the borrower make sure they know what they are signing is known as who? Underwriter Settlement agent Loan officer Wholesaler
Settlement agent
Once a mortgage loan originator's license is obtained, an individual must do all of the following to stay in compliance, EXCEPT? Make available, upon request of a state licensing agency, all books and records relating to operations of the originator Submit mortgage call reports to the Consumer Financial Protection Bureau Submit mortgage call reports to the NMLS Provide reports and additional information at the request of state authorities
Submit mortgage call reports to the Consumer Financial Protection Bureau
What are the three acts that make up the Do Not Call Laws? Telephone Customer Protections Act, Do Not Call Institutions Act, Do Not Call Improvements Act Telephone Consumer Protection Act, Do Not Call Implementation Act, Do Not Call Improvement Act Telephone Consumer Procedures Act, Do Not Call Industries Act, Do Not Call Improvements Act Telephone Solicitations Protections Act, Do Not Call Implementations Act, Do Not Call Amendments Act
Telephone Consumer Protection Act, Do Not Call Implementation Act, Do Not Call Improvement Act
Bob the broker has completed an application over the phone with Jane for a refinance on her primary home. During this process, Bob explained to Jane that she can sign the necessary documents in two different ways, either on his protected website or in paper copies that he can mail to her immediately. Which law's provisions require that Bob make this disclosure? The FTC Red Flags Rule The Electronic Signatures in Global and National Commerce Act The Telemarketing Sales Rule The Privacy provisions under Regulation P
The Electronic Signatures in Global and National Commerce Act
How are the Conforming Loan Limits (CLLs) set every year? Fannie Mae and Freddie Mac determine the loan limits each year from the data collected in HMDA L/AR reports from the previous year. The Federal Housing Finance Agency (FHFA) uses the October-to-October percentage increase/decrease in the average housing prices in the Monthly Interest Rate Survey to adjust the conforming loan limits for the subsequent year. The US Treasury Department uses the current housing trend to determine the housing values and then adjusts the conforming amount for the subsequent year. The Federal Housing Administration (FHA), which is part of the Department of Housing and Urban Development (HUD) and administers various loan programs, determines which loans cannot exceed the statutory limits and adjusts the loan limits accordingly.
The Federal Housing Finance Agency (FHFA) uses the October-to-October percentage increase/decrease in the average housing prices in the Monthly Interest Rate Survey to adjust the conforming loan limits for the subsequent year.
According to the record retention rules for RESPA, which of the following statements is correct? The Initial Escrow Statement must be retained for seven years. The Closing Disclosure must be retained for three years. The Mortgage Servicing Disclosure Statement must be retained for three years. The Mortgage Servicing Disclosure Statement must be retained for five years.
The Mortgage Servicing Disclosure Statement must be retained for five years.
In accordance with ECOA, a creditor cannot inquire as to whether income is derived from public assistance unless what? The applicant lives in a community property state. The creditor discloses to the applicant that such income need not be revealed and the applicant wants public assistance income to be considered by the creditor as a basis for payment of the credit requested. The applicant is legally divorced or separated. None of the choices
The creditor discloses to the applicant that such income need not be revealed and the applicant wants public assistance income to be considered by the creditor as a basis for payment of the credit requested.
In almost all mortgage fraud, who becomes the injured party? The underwriter The processor The lender The borrower
The lender
Which of the following is PROHIBITED when making a loan agreement with a prospective borrower for the assistance in finding a mortgage loan? The loan application is signed by the prospective borrower and the licensee. The loan agreement discloses to the prospective borrower the fees associated with the loan transaction. The loan agreement requires the payment of a finder's fee prior to the consummation of the loan. The loan agreement does not require the exclusive use of a particular title insurance company for settlement services.
The loan agreement requires the payment of a finder's fee prior to the consummation of the loan.
Which of the following is NOT true regarding the responsibilities of the state regulatory authority? The state authority can order a prison sentence upon a loan originator for compliance failure. The state authority can suspend or terminate a mortgage loan originator license. The state authority can investigate or examine any loan originator as often as necessary. The state authority can establish minimum net worth and/or surety bond requirements.
The state authority can order a prison sentence upon a loan originator for compliance failure.
Which of the following is NOT true regarding the state regulatory authority in relation to the SAFE Act of 2008? The state authority may adopt and enforce the SAFE Act. The state authority may create rules to aid the implementation of the SAFE Act. The state authority may apply and interpret the SAFE Act. The state authority may create laws to amend the SAFE Act.
The state authority may create laws to amend the SAFE Act.
Amongst other recent additions to TILA, MDIA added a waiting period to how quickly loans can close. Why is it important to not allow loans to close quicker than 7 business days? Mortgage loans can now close the same day as application, so this amendment no longer applies. MLOs can make a credit decision to waive this timeframe if deemed necessary This restriction helps prevent sellers from extorting homebuyers. This restriction promotes the informed receipt and use of credit.
This restriction promotes the informed receipt and use of credit.
Which of the following is true regarding the following statement in an advertisement: "lowest rates available for all credit types"? This statement is legal as long as the APR is stated for each available rate. This statement is in compliance with federal and state laws. This statement is considered a deceptive practice. This statement is legal as long as the maximum FICO score is disclosed.
This statement is considered a deceptive practice.
The annual completion of continuing education is essential to the maintenance of a mortgage loan originator license. Which of the following satisfies this requirement? Four hours of federal law and regulations, one hour of ethics, two hours of training related to lending standards for the nontraditional mortgage product marketplace, and one hour of elective Three hours of federal law and regulations, two hours of ethics, and two hours of training related to lending standards for the nontraditional mortgage product marketplace Three hours of federal law and regulations, two hours of ethics, two hours of training related to lending standards for the nontraditional mortgage product marketplace, and one hour of elective education Three hours of federal law and regulations, three hours of ethics, one hour of training related to lending standards for the nontraditional mortgage product marketplace, and one hour of elective education
Three hours of federal law and regulations, two hours of ethics, two hours of training related to lending standards for the nontraditional mortgage product marketplace, and one hour of elective education
During the application process with a new client, Bob the broker is about to ask the client about income. Which of the following questions or statements are permissible under ECOA? To ensure accuracy, you need to disclose information regarding income that is related in any way with alimony or child support, even if you don't plan on using this income to qualify. To qualify you for the best loan possible, I need to know how much income you're planning on using, if any of it is related to child support or alimony, you don't need to let me know unless you're using it to qualify. To qualify you correctly, I need to know how much income you are currently receiving from child support and alimony, if you don't receive any, you still need to let me know. To make sure your debt-to-income ratios are consistent with the guidelines, I need to know how much monthly income you're receiving from child support or alimony, if any.
To qualify you for the best loan possible, I need to know how much income you're planning on using, if any of it is related to child support or alimony, you don't need to let me know unless you're using it to qualify.
The Consumer Credit Protection Act produced which act? Homeowners Protection Act Fair Credit Reversal Act Equal Housing Opportunity Act Truth In Lending Act
Truth In Lending Act
Which of the following is true regarding USDA loans? USDA loans allow individuals to build a home. USDA loans have a funding fee of .35%. USDA loans have an annual fee of 1%. USDA loans require a minimum credit score of 500.
USDA loans allow individuals to build a home.
In which of the following situations can an MLO work with an unregistered or unlicensed mortgage broker or lender? If the broker originates 10 loan or less per year If the broker is temporarily unlicensed If the originators license is inactive Under no circumstances
Under no circumstances
Under what circumstances is an independently contracted loan processor or underwriter NOT required to obtain a mortgage loan originators license? Under no circumstances If the independent contractor does not discuss or negotiate mortgage-related terms If the independent contractor performs only administrative and clerical duties If the independent contractor is registered with NMLS
Under no circumstances
When can the loan servicer charge for a loan escrow account statement? If an account statement has already been provided that calendar year Under no circumstances If the property secured by the loan is used for investment purposes If there are multiple borrower's requesting it
Under no circumstances
When is the lender permitted to charge a fee for preparing a settlement statement? If the Title Company is unavailable to prepare the statement If the borrower wants a copy three days prior to closing Under no circumstances If there are out-of-town borrowers that need to review the statement
Under no circumstances
What is the best way to describe an individual who acts completely as a volunteer when negotiating mortgage loan terms? Independent contractor Unlicensed mortgage loan originator Licensed realtor Employee of a housing finance agency
Unlicensed mortgage loan originator
A "Certificate of Eligibility" is required for what loan? Both FHA VA Neither
VA
A mortgage processor's role includes which of the following? Providing an appraisal report Taking the initial loan application Verifying information from the initial application Presenting closing documents
Verifying information from the initial application