Minnesota Residential Mortgage Loan
Originator National Examination with
Uniform State Content (SAFE MLO)
Exam Practice Questions And Correct
Answers (Verified Answers) Plus
Rationales 2026 Q&A | Instant
Download Pdf
1. Which federal law requires lenders to provide consumers with
disclosures regarding the cost of credit?
A. Fair Housing Act
B. Real Estate Settlement Procedures Act
C. Truth in Lending Act
D. Equal Credit Opportunity Act
Answer: C. Truth in Lending Act
,Rationale: TILA requires disclosure of APR, finance charges, payment
schedules, and other credit terms to help consumers compare loans.
2. What is the primary purpose of the SAFE Act?
A. Reduce property taxes
B. Establish minimum licensing standards for mortgage loan originators
C. Regulate title insurance companies
D. Set mortgage interest rates
Answer: B. Establish minimum licensing standards for mortgage loan
originators
Rationale: The SAFE Act created national standards for MLO licensing,
registration, education, and testing.
3. Which agency maintains the Nationwide Multistate Licensing System
(NMLS)?
A. CFPB
B. FHA
C. FDIC
D. Conference of State Bank Supervisors and American Association of
Residential Mortgage Regulators
Answer: D. Conference of State Bank Supervisors and American
Association of Residential Mortgage Regulators
,Rationale: CSBS and AARMR jointly developed and maintain the NMLS.
4. A borrower’s debt-to-income ratio compares:
A. Assets to liabilities
B. Income to credit score
C. Monthly debt obligations to gross monthly income
D. Housing expenses to property value
Answer: C. Monthly debt obligations to gross monthly income
Rationale: DTI measures a borrower's ability to manage monthly payments
relative to income.
5. Which loan program is insured by the Federal Housing Administration?
A. VA Loan
B. Conventional Loan
C. USDA Loan
D. FHA Loan
Answer: D. FHA Loan
Rationale: FHA loans are insured by the Federal Housing Administration
and often allow lower down payments.
6. RESPA applies primarily to:
, A. Commercial loans only
B. Credit cards
C. Federally related mortgage loans
D. Auto loans
Answer: C. Federally related mortgage loans
Rationale: RESPA governs settlement procedures and disclosures for most
residential mortgage transactions.
7. Which disclosure replaced the HUD-1 Settlement Statement for most
mortgage transactions?
A. Loan Estimate
B. Closing Disclosure
C. Good Faith Estimate
D. Escrow Statement
Answer: B. Closing Disclosure
Rationale: TRID rules replaced the HUD-1 with the Closing Disclosure.
8. What is the minimum age required to obtain an MLO license?
A. 18
B. 18
Originator National Examination with
Uniform State Content (SAFE MLO)
Exam Practice Questions And Correct
Answers (Verified Answers) Plus
Rationales 2026 Q&A | Instant
Download Pdf
1. Which federal law requires lenders to provide consumers with
disclosures regarding the cost of credit?
A. Fair Housing Act
B. Real Estate Settlement Procedures Act
C. Truth in Lending Act
D. Equal Credit Opportunity Act
Answer: C. Truth in Lending Act
,Rationale: TILA requires disclosure of APR, finance charges, payment
schedules, and other credit terms to help consumers compare loans.
2. What is the primary purpose of the SAFE Act?
A. Reduce property taxes
B. Establish minimum licensing standards for mortgage loan originators
C. Regulate title insurance companies
D. Set mortgage interest rates
Answer: B. Establish minimum licensing standards for mortgage loan
originators
Rationale: The SAFE Act created national standards for MLO licensing,
registration, education, and testing.
3. Which agency maintains the Nationwide Multistate Licensing System
(NMLS)?
A. CFPB
B. FHA
C. FDIC
D. Conference of State Bank Supervisors and American Association of
Residential Mortgage Regulators
Answer: D. Conference of State Bank Supervisors and American
Association of Residential Mortgage Regulators
,Rationale: CSBS and AARMR jointly developed and maintain the NMLS.
4. A borrower’s debt-to-income ratio compares:
A. Assets to liabilities
B. Income to credit score
C. Monthly debt obligations to gross monthly income
D. Housing expenses to property value
Answer: C. Monthly debt obligations to gross monthly income
Rationale: DTI measures a borrower's ability to manage monthly payments
relative to income.
5. Which loan program is insured by the Federal Housing Administration?
A. VA Loan
B. Conventional Loan
C. USDA Loan
D. FHA Loan
Answer: D. FHA Loan
Rationale: FHA loans are insured by the Federal Housing Administration
and often allow lower down payments.
6. RESPA applies primarily to:
, A. Commercial loans only
B. Credit cards
C. Federally related mortgage loans
D. Auto loans
Answer: C. Federally related mortgage loans
Rationale: RESPA governs settlement procedures and disclosures for most
residential mortgage transactions.
7. Which disclosure replaced the HUD-1 Settlement Statement for most
mortgage transactions?
A. Loan Estimate
B. Closing Disclosure
C. Good Faith Estimate
D. Escrow Statement
Answer: B. Closing Disclosure
Rationale: TRID rules replaced the HUD-1 with the Closing Disclosure.
8. What is the minimum age required to obtain an MLO license?
A. 18
B. 18
