NMLS Test Prep (Latest Update)

NMLS Test Prep (Latest Update) A borrower receives $1,000 per month in rental income. How much of the income may be used to qualify the borrower for a loan? A. $1,000 B $800 C $750 D $1,250 - ANS-$750 The answer is $750. Generally, 75% of rental income may be used to qualify a borrower for a loan. This formula is based on an industry standard that taxes, insurance, and maintenance costs will equal about 25% of the income that a property generates. In this case, 75% × $1,000 = $750. The S.A.F.E. Act applies to mortgage loan originators who take applications for, or offer or negotiate terms of, residential mortgage loans, which would include: Land to be used for agricultural purposes An apartment building with 30 units A dwelling not secured by a mortgage or trust deed A mobile home to be used as a residence, even if it is not attached to the land - ANS-A mobile home to be used as a residence, even if it is not attached to the land The S.A.F.E. Act defines a mortgage loan originator as an individual who takes residential mortgage loan applications, or offers or negotiates terms of residential mortgage loans for compensation or gain. The S.A.F.E. Act's definition of "residential mortgage loan" includes a loan secured by a consensual security interest on a dwelling and cross-references the definition of the term "dwelling" in the Truth-in-Lending Act (TILA). Regulation Z, which implements TILA, defines a dwelling as a residential structure that contains one to four units, whether or not that structure is attached to real property. The term includes an individual condominium unit, cooperative unit, mobile home, and trailer, if it is used as a residence. What is Freddie Mac's automated underwriting system called? Desktop Originator Underwriter Assistant Loan Product Advisor AUS - ANS-Loan Product Advisor Freddie Mac's automated underwriting system is called Loan Product Advisor (formerly known as Loan Prospector), while Fannie Mae's is called Desktop Underwriter. Which of the following contains only items which should be used in calculating a borrower's debt-to-income ratio? Continues...