SAFE EXAM DOMINATED: THE A+
BLUEPRINT FOR NMLS SUCCESS –
FEDERAL & STATE COMPLIANCE
(2026/2027)
Advertising Disclosure - THE CORRECT ANSWER-An advertisement
must be presented "clearly and conspicuously" to keep from
being deceptive, unfair, or otherwise violate a Commission rule
Waving Right of Rescission - THE CORRECT ANSWER-Extenuating
circumstances such as "bona fide personal financial emergency
Right of Rescission - THE CORRECT ANSWER-Right that borrowers
have to cancel a loan or line of credit with a lender within three
days of closing
Business Day - THE CORRECT ANSWER-When creditors office is open
to the public, a calendar working day except Sunday or a federal
holiday
Application - THE CORRECT ANSWER-Financial information used for
purposes of obtaining an extension of credit
Disclosure - THE CORRECT ANSWER-The act of making new
information known
,FTC
Federal Trade Commission - THE CORRECT ANSWER-Mission is to
promote consumer protection and eliminate and prevent
anticompetitive business practices
CFPB
Consumer Financial Protection Bureau - THE CORRECT ANSWER-
Regulatory agency charged with overseeing financial products
and services offered to consumers
TILA
Truth in Lending Act - THE CORRECT ANSWER-Enacted 1968
promotes the informed use of consumer credit by requiring
disclosures about terms and costs and standardizes the manner
in which costs with borrowing are calculated and disclosed
Per Diem Interest - THE CORRECT ANSWER-Interest charged on a loan
for one or more days
Annual Interest Rate Formula - THE CORRECT ANSWER-Principal (X)
Interest Rate = Annual Interest Rate
Interest Only Mortgage - THE CORRECT ANSWER-Mortgage where the
mortgagor is only required to pay off the interest that arises
from the principal that is borrowed for a set period
Permanent Buydown - THE CORRECT ANSWER-Borrower chooses to
pay additional "discount points" to buy down the interest rate
for the life of the mortgage note
,2/1 Buydown - THE CORRECT ANSWER-Used on fixed rate loans over
two years
Set of two initial temporary-start interest rates that increase in
stair-step fashion until a permanent interest rate is reached
Discount Point - THE CORRECT ANSWER-A form of pre-paid interest
which effectively increases the yield on the loan above the
amount of the stated interest rate
CLTV
Combined Loan to Value - THE CORRECT ANSWER-An amount in
addition to the Loan to Value, which simply represents the first
position mortgage or loan as a percentage of the property's
value
LTV
Loan to Value - THE CORRECT ANSWER-Ratio of a loan to the value of
an asset purchased
PITI - THE CORRECT ANSWER-Principal, Interest, Taxes, Insurance
Refers to the components of a mortgage payment
DIF - THE CORRECT ANSWER-Housing to Debt
Ratio that measures an individual's ability to manage monthly
payment and repay debts
, Forbearance - THE CORRECT ANSWER-Agreement between the lender
and the borrower to delay foreclosure
Loan Modification - THE CORRECT ANSWER-A permanent
restructuring of the mortgage where one or more of the terms of
a borrower's loan are changed to provide a more affordable
payment
Foreclosure - THE CORRECT ANSWER-Legal process to collect debt on
mortgaged property
Satisfaction of Mortgage Letter - THE CORRECT ANSWER-Document
generated and signed by a mortgage lender, acknowledging that
the borrower has paid off the mortgage loan in full and the
mortgage is not a lien on the property
Subordination Agreement - THE CORRECT ANSWER-When two
mortgages are on a property, this specifies which mortgage
takes precedence
Payoff Statement - THE CORRECT ANSWER-Provides homeowner
proof the mortgage is paid off
Constructive Note - THE CORRECT ANSWER-Legal presumption that
anything recorded in a public record can be known by anyone
Actual Note - THE CORRECT ANSWER-Direct knowledge that one has
of the property
BLUEPRINT FOR NMLS SUCCESS –
FEDERAL & STATE COMPLIANCE
(2026/2027)
Advertising Disclosure - THE CORRECT ANSWER-An advertisement
must be presented "clearly and conspicuously" to keep from
being deceptive, unfair, or otherwise violate a Commission rule
Waving Right of Rescission - THE CORRECT ANSWER-Extenuating
circumstances such as "bona fide personal financial emergency
Right of Rescission - THE CORRECT ANSWER-Right that borrowers
have to cancel a loan or line of credit with a lender within three
days of closing
Business Day - THE CORRECT ANSWER-When creditors office is open
to the public, a calendar working day except Sunday or a federal
holiday
Application - THE CORRECT ANSWER-Financial information used for
purposes of obtaining an extension of credit
Disclosure - THE CORRECT ANSWER-The act of making new
information known
,FTC
Federal Trade Commission - THE CORRECT ANSWER-Mission is to
promote consumer protection and eliminate and prevent
anticompetitive business practices
CFPB
Consumer Financial Protection Bureau - THE CORRECT ANSWER-
Regulatory agency charged with overseeing financial products
and services offered to consumers
TILA
Truth in Lending Act - THE CORRECT ANSWER-Enacted 1968
promotes the informed use of consumer credit by requiring
disclosures about terms and costs and standardizes the manner
in which costs with borrowing are calculated and disclosed
Per Diem Interest - THE CORRECT ANSWER-Interest charged on a loan
for one or more days
Annual Interest Rate Formula - THE CORRECT ANSWER-Principal (X)
Interest Rate = Annual Interest Rate
Interest Only Mortgage - THE CORRECT ANSWER-Mortgage where the
mortgagor is only required to pay off the interest that arises
from the principal that is borrowed for a set period
Permanent Buydown - THE CORRECT ANSWER-Borrower chooses to
pay additional "discount points" to buy down the interest rate
for the life of the mortgage note
,2/1 Buydown - THE CORRECT ANSWER-Used on fixed rate loans over
two years
Set of two initial temporary-start interest rates that increase in
stair-step fashion until a permanent interest rate is reached
Discount Point - THE CORRECT ANSWER-A form of pre-paid interest
which effectively increases the yield on the loan above the
amount of the stated interest rate
CLTV
Combined Loan to Value - THE CORRECT ANSWER-An amount in
addition to the Loan to Value, which simply represents the first
position mortgage or loan as a percentage of the property's
value
LTV
Loan to Value - THE CORRECT ANSWER-Ratio of a loan to the value of
an asset purchased
PITI - THE CORRECT ANSWER-Principal, Interest, Taxes, Insurance
Refers to the components of a mortgage payment
DIF - THE CORRECT ANSWER-Housing to Debt
Ratio that measures an individual's ability to manage monthly
payment and repay debts
, Forbearance - THE CORRECT ANSWER-Agreement between the lender
and the borrower to delay foreclosure
Loan Modification - THE CORRECT ANSWER-A permanent
restructuring of the mortgage where one or more of the terms of
a borrower's loan are changed to provide a more affordable
payment
Foreclosure - THE CORRECT ANSWER-Legal process to collect debt on
mortgaged property
Satisfaction of Mortgage Letter - THE CORRECT ANSWER-Document
generated and signed by a mortgage lender, acknowledging that
the borrower has paid off the mortgage loan in full and the
mortgage is not a lien on the property
Subordination Agreement - THE CORRECT ANSWER-When two
mortgages are on a property, this specifies which mortgage
takes precedence
Payoff Statement - THE CORRECT ANSWER-Provides homeowner
proof the mortgage is paid off
Constructive Note - THE CORRECT ANSWER-Legal presumption that
anything recorded in a public record can be known by anyone
Actual Note - THE CORRECT ANSWER-Direct knowledge that one has
of the property
