MLO: Chapter 6

Facebook was forced to pay how much amount of money to FTC and SEC?

Facebook was forced to pay 5 billion dollars to the FTC and SEC

Telemarketers are required to scrub their telemarketing or client list with the Do Not Call Registry every _____

31 days

A short sale is less damaging to a borrower's credit than a foreclosure.

A short sale is less damaging to a borrower's credit than a foreclosure.

A mortgage loan that meets the guidelines and is under the maximum amount of loans that Fannie Mae and Freddie Mac are legally allowed to buy.

Conforming Loan

______________ occurs when a lender sneaks in paperwork at closing that provides credit insurance or other benefits that they borrower did not request.

Credit insurance packing occurs when a lender sneaks in paperwork at closing that provides credit insurance or other benefits that they borrower did not request.

What is an example of a Deceptive Act or Practice?

False Advertising, and not providing disclosures.

All Robo Call companies need to have an automated "opt out" option at the end of every call.

False. All Robo Call companies need to have an automated "opt out" option at the beginning of every call.

Fair Lending is granting access to credit to only those you choose who submits an application and qualifies for a loan. True or False?

False. Fair Lending is granting access to credit to everyone and anyone who wishes to submit an application and qualifies for a loan.

A mortgage that is senior to all other mortgages or liens on the same property.

First Lien Position

Fraud for Criminal Enterprise is usually done by homeowners.

Fraud for Criminal Enterprise is usually done by a wide range of criminals and often involves money-laundering.

Which of the following is not one of three types or motivations for mortgage fraud? Fraud for Profit Fraud for Criminal Enterprise Fraud for Housing/Property Fraud for Integrity

Fraud for Integrity

HMDA is Regulation _____.

HMDA is Regulation C

If an MLO commits mortgage fraud in one state, it won't affect their standing in other states.

If an MLO commits mortgage fraud in one state, it can affect their standing in other states.

Which of the following is a sign of a possible Straw Buyer? Inconsistent signatures throughout the file A minimal increase in housing expense Gift funds for down payment from the father Low LTV, High reserves

Inconsistent signatures throughout the file

Who is impacted by mortgage fraud?

Many people are impacted by mortgage fraud, including borrowers, the community, and lenders.

Any loan that does not meet Fannie Mae or Freddie Mac lending requirements.

Non-Conforming Loan

An evaluation of a potential borrower by a lender that determines whether the borrower qualifies for a loan from the lender, or the maximum amount that the lender would be willing to lend. Credit, income and assets are verified. It is not a loan commitment.

Pre-Approval

Predatory lenders use _____ closing costs to make more money off borrowers.

Predatory lenders use padding closing costs to make more money off borrowers.

A "promise to pay" is a note that details money borrowed from a lender and the repayment structure.

Promissory Note

Redlining and Reverse Redlining are the same thing. True or False?

Redlining and Reverse Redlining are NOT the same thing.

Which of the following is NOT a Common Fraud Scheme? Reverse Mortgage Equity Skimming Affinity Fraud Short Sale Flip

Reverse Mortgage

What are some of the requirements for Reverse Mortgages?

Reverse Mortgages require the borrower to continue paying property taxes and to maintain the property.

What is the definition of Ethics? Temptation of cash that can lead an MLO to commit an unlawful act The MLO needs to have high integrity The moral principles that govern a person's behavior or conduct Principles concerning the distinction between right and wrong or good and bad behavior

The moral principles that govern a person's behavior or conduct

Who investigates Reverse Mortgage Fraud?

The CFPB investigates reverse mortgage fraud.

Which entity prescribed rules prohibiting deceptive telemarketing acts or practices?

The CFPB prescribed rules prohibiting deceptive telemarketing acts or practices.

The CFPB used ______ for its first use of testing.

The CFPB used Mystery Shoppers for its first use of testing.

Which of the following is an indication of a Foreclosure Rescue Scheme? The borrower was advised by foreclosure specialists to avoid contact with their servicer The borrower is sending their mortgage payments to the lender The borrower receives a purchase offer for an easy sale The borrower has negotiated with the servicer

The borrower was advised by foreclosure specialists to avoid contact with their servicer

Under terms of the Consent Order regarding reverse mortgages, which of the following are some of the laws?

The consent order requires that companies cannot imply affiliation with the Government, must make clear and prominent disclosures, and must keep complete and accurate records.

Which is not an example of an Unfair Act or Practice? Substantial injury that is only monetary Injuries that are not outweighed by countervailing benefits to consumers or competition Something that causes substantial injury to consumers Injuries that are not reasonably avoided by consumers

The harm or injury can also be non-monetary

A Straw Buyer may not always be aware of the fraud.

True.

TRUE OR FALSE: If a loan is going to be approved, you must provide a Notice of Action to the borrower.

True.

The 2011 Mortgage Acts and Practices Advertising Rule prohibits misleading claims in mortgage advertising, including implying a government affiliation.

True.

MARs stands for Mortgage Assistance Relief Services.

True. MARs stands for Mortgage Assistance Relief Services.

There is a National Do Not Call List and each company also needs to have an internal Do Not Call List. True or False?

True. There is a National Do Not Call List and each company also needs to have an internal Do Not Call List

The lender in this case was accused of receiving more applications by structuring its business to discourage minorities from applying for a loan.

True. he lender in this case was accused of receiving more applications by structuring its business to discourage minorities from applying for a loan. Which is redlining.

When did UDAAPs become illegal, according to the Dodd-Frank Wall Street Reform and Consumer Protection Act?

UDAAPs became illegal in 2010.