MLO SAFE NMLS Safe Test Practice Questions | 100% Correct Answers | Verified | Latest 2024 Version

Taking advantage of ill-informed consumers through excessively high fees, misrepresented loan terms, frequent refinancing that does not benefit the borrower and other prohibited acts is called __________________________. - Predatory Lending. RESPA-Real Estate Settlement Procedures Act - The Federal Statute that deals with the settlement of residential mortgage loans. RESPA's section 9 Prohibits - Home sellers from requiring home buyers to purchase title insurance from a particular company providing title services. The Dodd-Frank Act modifies ECOA to require a 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. - upon completion and 3 business days TIL (Truth In Lending Disclosure) & GFE (Good Faith Estimate) - Per the Dodd Frank Act, a single disclosure form combines these 2 statements. Per the Dodd-Frank Acvt, to be a "qualified mortgage" total points and fees may not exceed ________% of the total loan amount. - 3% (three percent) Per a provision of the Dodd-Frank Act mortgage 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? - All loans, whether owner occupied or not. A loan subject to HOEPA allows prepayment penalties for the first ______ years of the loan. - 2 (two) years Per the Dodd-Frank Act an abusive act would include 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. - All three would be considered abusive acts. Per the Dodd-Frank Act if an MLO receives compensation directly from a consumer, up to how much additional compensation may be received from a lender in the same transaction? - $0.00, dual compensation is not allowed. Compensation must be borrower paid or lender paid. What kinds of reasons are necessary for a lender to take adverse action with regard to a borrower? - Specific reasons. 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 for _____________ months. - 25 Months Because of the impact of the Dodd-Frank Act on a second mortgage, an APR that exceeds the ________ by more than _____% is the trigger that defines a high cost loan. - APOR ( Average Prime Offer Rate), 8.5% 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 Affiliated Business Arrangement require a borrower to use a specific third party service provider? - If there are no kickback or referral fees and the service provider is an attorney, credit reporting agency or appraiser the lender can require that the borrower uses the provider If a transfer of servicing occurs, the _______________ must provide a servicing transfer statement not less than ________ days before the transfer occurs. - Servicer, 15 (fifteen) days.An individual who fails the MLO written exam 3 times must wait _________ months to retake the exam. - 6 (Six) Months Per RESPA, an annual escrow statement is required to ______________. - determine shortages and surpluses in the escrow account. When must the Servicing Disclosure Statement be provided to the borrower? - Within 3 (three) Business Days of the Application. Any party involved in a federally covered loan that submits fraudulent information is subject to a fine of up to $___________ and up to __________years in prison. - $1,000,000 (one million dollars), 30 years in prison Per RESPA, an escrow cushion is limited to a maximum of ______