NMLS EXAM 1 Questions with Complete Solutions

NMLS EXAM 1 Questions with Complete Solutions 7) Which of the following agencies reviewed and approved the model state law written by CSBS and AARMR: A. HUD B. USDA C. Dept of Veterans Affairs D. OTS - Answer-A. Yes, the Department of Housing and Urban Development reviewed the legislation for definitions, education and testing requirements, financial responsibility and criminal background standards for MLOs and found it met the minimum requirements for the SAFE Act. 8) According to the SAFE Act, a mortgage loan originator must have the MLO designation to perform all of the following duties except: A. Take a residential mortgage loan application B. Perform work related to extensions of credit for timeshare plans C. Negotiate terms of a residential mortgage loan D. Advise a consumer on rates, fees, and other costs - Answer-B. An individual would NOT need the MLO designation to perform work related to extensions of credit for timeshare plans. 9) All of the following MLOs are required to be state-licensed except: A. An MLO working under the authority of the Bureau of Real Estate B. An MLO working as a Consumer Finance Lender (CFL) C. An MLO working for a federally insured depository institution D. An MLO working as a mortgage banker through the DBO - Answer-C. This would include banks, credit unions and subsidiaries owned and controlled by a depository institution and regulated by a federal banking agency. 10) According to the SAFE Act, which of the following do not need to have a unique identifier number to work as an MLO: A. An employee of an insured depository institution B. An MLO working under the authority of the DRE C. An MLO working under the authority of the DBO D. None of the above - Answer-D. All MLO's need a unique identifier number. The employee of an insured depository institution, however, is registered with the NMLS, not licensed. 11) Which of the following best defines appraisal: A. Same as price B. An estimate of value C. Same as cost D. An estimate of market value - Answer-D. There is nothing wrong with "B" as an answer, but in the context of residential mortgages, "D" is the best answer and will contribute to your point total.