MLO SAFE NMLS Test Practice Questions & Answers
The Dodd-Frank Act modifies ECOA to require a upon completion and 3 business days
creditor to furnish a copy of an appraisal developed in
connection with a first mortgage_____________________ and
absolutely not later than ________ business days prior to
closing.
TIL (Truth In Lending Disclosure) & GFE (Good Faith Per the Dodd Frank Act, a single disclosure form combines these 2 statements.
Estimate)
Per the Dodd-Frank Acvt, to be a "qualified mortgage" 3% (three percent)
total points and fees may not exceed ________% of the
total loan amount.
Per a provision of the Dodd-Frank Act mortgage All loans, whether owner occupied or not.
lenders are to determine that a borrower has a
reasonable ability to repay a loan. Does this provision
apply to all loans or just owner occupied loans?
A loan subject to HOEPA allows prepayment penalties 2 (two) years
for the first ______ years of the loan.
Per the Dodd-Frank Act an abusive act would include All three would be considered abusive acts.
which of the following:
1. One that materially interferes with the consumers
ability to understand the product or service.
2. One that take unreasonable advantage of a
consumers' lack of understanding.
3. One that takes unreasonable advantage of the
consumer's reasonable reliance on the MLO.
Per the Dodd-Frank Act if an MLO receives $0.00, dual compensation is not allowed. Compensation must be borrower paid
compensation directly from a consumer, up to how or lender paid.
much additional compensation may be received from a
lender in the same transaction?
What kinds of reasons are necessary for a lender to Specific reasons.
take adverse action with regard to a borrower?
Adverse action means ______________________. A denial or revocation of credit. Also, a change in the terms of an existing credit
arrangement or a refusal to grant credit in substantially the amount or terms
requested.
Per Regulation B, Lenders should retain certain records 25 Months
for _____________ months.
, MLO SAFE NMLS Test Practice Questions & Answers
Because of the impact of the Dodd-Frank Act on a APOR ( Average Prime Offer Rate), 8.5%
second mortgage, an APR that exceeds the ________ by
more than _____% is the trigger that defines a high cost
loan.
Regulation C is known as ________________________. HMDA, The Home Mortgage Disclosure Act.
What is the purpose of HMDA? The HMDA determines whether financial institutions are serving the housing
needs of their communities. It also identifies patterns of discriminatory lending.
Under what circumstances can a lender with an If there are no kickback or referral fees and the service provider is an attorney,
Affiliated Business Arrangement require a borrower to credit reporting agency or appraiser the lender can require that the borrower
use a specific third party service provider? uses the provider
If a transfer of servicing occurs, the _______________ must Servicer, 15 (fifteen) days.
provide a servicing transfer statement not less than
________ days before the transfer occurs.
An individual who fails the MLO written exam 3 times 6 (Six) Months
must wait _________ months to retake the exam.
Per RESPA, an annual escrow statement is required to determine shortages and surpluses in the escrow account.
______________.
When must the Servicing Disclosure Statement be Within 3 (three) Business Days of the Application.
provided to the borrower?
Any party involved in a federally covered loan that $1,000,000 (one million dollars), 30 years in prison
submits fraudulent information is subject to a fine of up
to $___________ and up to __________years in prison.
Per RESPA, an escrow cushion is limited to a maximum 1/6th (2 months), $50 (fifty dollars), 30 (thirty) days.
of _________ of the annual payments and surpluses over
$_____must be refunded within ________ days.
A seller takes back a $100,000 PMM @ 5.5% interest. This $100,000 + interest for the last month. A straight note (term mortgage) is a non-
straight note will balloon after 10 years of payments. amortizing interest only mortgage. The balloon would include the entire
How much is the balloon payment? principal plus the last month's interest, as interest is paid in arrears.
FNMA conforming debt ratios equal ______/________. 28%, maximum housing expense/36% maximum total obligations
HOEPA stands for ___________________________. Home Ownership and Equity Protection Act.
RESPA applies to what type of properties? 1-4 Unit Residential Properties
, MLO SAFE NMLS Test Practice Questions & Answers
On a conventional mortgage loan, who makes the final The Underwriter
decision regarding approval, denial or counter offer?
The Civil Rights Act of 1866, prohibited public and The Civil Rights Act of 1968, also known as Title VIII of the Civil Rights Act , Also
private racial discrimination in any property transaction known as Title VIII, Also Known as The Fair Housing Act
and was expanded in 1968 in which act?
Of the following, which is not required to be disclosed The note rate is NOT required.
on the TIL statement? The (1) APR, (2) Note Rate, (3)
Finance Charge, (4) Amount Financed or (5) Total of
Payments
Which act of 1968 provides guidelines and restrictions The Civil Rights Act of 1968. AKA, The Civil Rights Act, AKA Title VIII, AKA The
regarding the financing, selling and renting of real Fair Housing Act
property?
Which act prohibits asking questions regarding child ECOA/Regulation B, the Equal Credit Opportunity Act
bearing intentions or birth control practices?
Based on objective criteria regarding the condition and YES, loans can be denied in a geographic area, but not for discriminatory
value of the property or area, may a lender deny loans reasons relative to the population of the area.
in neighborhoods where property values are declining?
A teaser rate occurs in an ARM when the starting rate is Fully indexed rate.
less than the _____________.
Per ECOA, is it true that while a lender must consider Yes, it is true. Only income intended to be used for qualifying has to be
reliable alimony, child support or separate maintenance disclosed and verified.
payments as income, the applicant is not required to
disclose such income?
Of the following, who make a flood zone 2. The Appraiser makes the flood zone determination.
determination?
1. The Lender
2. The Appraiser
3. The Surveyor
4. The Underwriter
Force-placed insurance protects the _________________. a. lender
a. Lender
b. borrower
c. both
FHA requires mortgage insurance on all loans for a 5 (five) years.
period of ______________ years.
The Dodd-Frank Act modifies ECOA to require a upon completion and 3 business days
creditor to furnish a copy of an appraisal developed in
connection with a first mortgage_____________________ and
absolutely not later than ________ business days prior to
closing.
TIL (Truth In Lending Disclosure) & GFE (Good Faith Per the Dodd Frank Act, a single disclosure form combines these 2 statements.
Estimate)
Per the Dodd-Frank Acvt, to be a "qualified mortgage" 3% (three percent)
total points and fees may not exceed ________% of the
total loan amount.
Per a provision of the Dodd-Frank Act mortgage All loans, whether owner occupied or not.
lenders are to determine that a borrower has a
reasonable ability to repay a loan. Does this provision
apply to all loans or just owner occupied loans?
A loan subject to HOEPA allows prepayment penalties 2 (two) years
for the first ______ years of the loan.
Per the Dodd-Frank Act an abusive act would include All three would be considered abusive acts.
which of the following:
1. One that materially interferes with the consumers
ability to understand the product or service.
2. One that take unreasonable advantage of a
consumers' lack of understanding.
3. One that takes unreasonable advantage of the
consumer's reasonable reliance on the MLO.
Per the Dodd-Frank Act if an MLO receives $0.00, dual compensation is not allowed. Compensation must be borrower paid
compensation directly from a consumer, up to how or lender paid.
much additional compensation may be received from a
lender in the same transaction?
What kinds of reasons are necessary for a lender to Specific reasons.
take adverse action with regard to a borrower?
Adverse action means ______________________. A denial or revocation of credit. Also, a change in the terms of an existing credit
arrangement or a refusal to grant credit in substantially the amount or terms
requested.
Per Regulation B, Lenders should retain certain records 25 Months
for _____________ months.
, MLO SAFE NMLS Test Practice Questions & Answers
Because of the impact of the Dodd-Frank Act on a APOR ( Average Prime Offer Rate), 8.5%
second mortgage, an APR that exceeds the ________ by
more than _____% is the trigger that defines a high cost
loan.
Regulation C is known as ________________________. HMDA, The Home Mortgage Disclosure Act.
What is the purpose of HMDA? The HMDA determines whether financial institutions are serving the housing
needs of their communities. It also identifies patterns of discriminatory lending.
Under what circumstances can a lender with an If there are no kickback or referral fees and the service provider is an attorney,
Affiliated Business Arrangement require a borrower to credit reporting agency or appraiser the lender can require that the borrower
use a specific third party service provider? uses the provider
If a transfer of servicing occurs, the _______________ must Servicer, 15 (fifteen) days.
provide a servicing transfer statement not less than
________ days before the transfer occurs.
An individual who fails the MLO written exam 3 times 6 (Six) Months
must wait _________ months to retake the exam.
Per RESPA, an annual escrow statement is required to determine shortages and surpluses in the escrow account.
______________.
When must the Servicing Disclosure Statement be Within 3 (three) Business Days of the Application.
provided to the borrower?
Any party involved in a federally covered loan that $1,000,000 (one million dollars), 30 years in prison
submits fraudulent information is subject to a fine of up
to $___________ and up to __________years in prison.
Per RESPA, an escrow cushion is limited to a maximum 1/6th (2 months), $50 (fifty dollars), 30 (thirty) days.
of _________ of the annual payments and surpluses over
$_____must be refunded within ________ days.
A seller takes back a $100,000 PMM @ 5.5% interest. This $100,000 + interest for the last month. A straight note (term mortgage) is a non-
straight note will balloon after 10 years of payments. amortizing interest only mortgage. The balloon would include the entire
How much is the balloon payment? principal plus the last month's interest, as interest is paid in arrears.
FNMA conforming debt ratios equal ______/________. 28%, maximum housing expense/36% maximum total obligations
HOEPA stands for ___________________________. Home Ownership and Equity Protection Act.
RESPA applies to what type of properties? 1-4 Unit Residential Properties
, MLO SAFE NMLS Test Practice Questions & Answers
On a conventional mortgage loan, who makes the final The Underwriter
decision regarding approval, denial or counter offer?
The Civil Rights Act of 1866, prohibited public and The Civil Rights Act of 1968, also known as Title VIII of the Civil Rights Act , Also
private racial discrimination in any property transaction known as Title VIII, Also Known as The Fair Housing Act
and was expanded in 1968 in which act?
Of the following, which is not required to be disclosed The note rate is NOT required.
on the TIL statement? The (1) APR, (2) Note Rate, (3)
Finance Charge, (4) Amount Financed or (5) Total of
Payments
Which act of 1968 provides guidelines and restrictions The Civil Rights Act of 1968. AKA, The Civil Rights Act, AKA Title VIII, AKA The
regarding the financing, selling and renting of real Fair Housing Act
property?
Which act prohibits asking questions regarding child ECOA/Regulation B, the Equal Credit Opportunity Act
bearing intentions or birth control practices?
Based on objective criteria regarding the condition and YES, loans can be denied in a geographic area, but not for discriminatory
value of the property or area, may a lender deny loans reasons relative to the population of the area.
in neighborhoods where property values are declining?
A teaser rate occurs in an ARM when the starting rate is Fully indexed rate.
less than the _____________.
Per ECOA, is it true that while a lender must consider Yes, it is true. Only income intended to be used for qualifying has to be
reliable alimony, child support or separate maintenance disclosed and verified.
payments as income, the applicant is not required to
disclose such income?
Of the following, who make a flood zone 2. The Appraiser makes the flood zone determination.
determination?
1. The Lender
2. The Appraiser
3. The Surveyor
4. The Underwriter
Force-placed insurance protects the _________________. a. lender
a. Lender
b. borrower
c. both
FHA requires mortgage insurance on all loans for a 5 (five) years.
period of ______________ years.
