(NMLS ) NATIONWIDE MULTI STATE
LICENSING SYSTEM (NMLS) EXAM 2024/2025
QUESTIONS AND ANSWERS SPRING GRADED
A+
The Truth-In-Lending Act compels creditors (or brokers acting as a creditor agent) to disclose
which of the following to borrowers who are refinancing a primary residence?
Select one:
A. That they are entitled to a three (3) business day right of rescission period
B. That they are entitled to a home equity line of credit in lieu of a refinance
C. That if their payment increases more than point five percent (.5%) over their existing rate that
it is considered a high cost loan
D. That they cannot refinance their loan again within a twelve (12) month period or it will be
considered churning which is illegal
A. That they are entitled to a three (3) business day right of rescission period
This type of notice is given to consumers who are not customers, in lieu of full initial notice,
when the lender has no plans to share nonpublic personal information about them.
Select one:
A. Initial notice
B. Opt- Out notice
C. Short- Form notice
D. Simplified notice
C. Short- Form notice
,The Dodd-Frank Act minimum standards for mortgage loans have eliminated which of the
following types of loans?
Select one:
A. No Income Verification loans (NIV)
B. Adjustable rate loans
C. FHA and VA loans
D. Loans with prepayment penalties
A. No Income Verification loans (NIV)
In a deed of trust, the power of sale in the event of default is given from the:
Select one:
A. Beneficiary to trustee
B. Trustor to the trustee
C. Buyer to the seller
D. Trustee to the beneficiary
B. Trustor to the trustee
Which of the following general loan types does HMDA NOT require financial institutions to
identify each calendar year?
Select one:
A. Conventional
B. FHA - insured
,C. VA - guaranteed
D. Construction loans
D. Construction loans
When can a creditor ask about an applicant's marital status?
Select one:
A. When the information is used to determine whether credit is extended
B. Never, asking such a question is considered discrimination
C. When the information is not used to determine whether credit will be extended
D. This information does not matter and creditors should not ask
C. When the information is not used to determine whether credit will be extended
The practice of sneaking a burdensome provision into the loan contract without the borrower's
knowledge is known as what?
Select one:
A. Equity Stripping
B. Steering
C. Contract Knavery
D. Price Gouging
C. Contract Knavery
Which of the following is NOT a TILA or RESPA mandated disclosure?
, Select one:
A. Closing Disclosure
B. Loan Estimate
C. Mortgage Servicing Disclosure
D. An Adverse Action Statement
D. An Adverse Action Statement
Which of the following does not affect a Veterans Funding fee?
Select one:
A. Loan Amount
B. Prior Service (Active/ Reserve)
C. Marital Status
D. Prior Use of Entitlement
C. Marital Status
AD
FACTA requires that if a lender uses credit scores in making or arranging loans that it must
provide certain information. Which of the following is not required?
Select one:
A. The range of possible credit scores under the model used
B. If any factors adversely affected the consumer's score, up to 4 key factors that adversely
affected the score (including inquiries)
C. Suggestions on how to improve credit scores
LICENSING SYSTEM (NMLS) EXAM 2024/2025
QUESTIONS AND ANSWERS SPRING GRADED
A+
The Truth-In-Lending Act compels creditors (or brokers acting as a creditor agent) to disclose
which of the following to borrowers who are refinancing a primary residence?
Select one:
A. That they are entitled to a three (3) business day right of rescission period
B. That they are entitled to a home equity line of credit in lieu of a refinance
C. That if their payment increases more than point five percent (.5%) over their existing rate that
it is considered a high cost loan
D. That they cannot refinance their loan again within a twelve (12) month period or it will be
considered churning which is illegal
A. That they are entitled to a three (3) business day right of rescission period
This type of notice is given to consumers who are not customers, in lieu of full initial notice,
when the lender has no plans to share nonpublic personal information about them.
Select one:
A. Initial notice
B. Opt- Out notice
C. Short- Form notice
D. Simplified notice
C. Short- Form notice
,The Dodd-Frank Act minimum standards for mortgage loans have eliminated which of the
following types of loans?
Select one:
A. No Income Verification loans (NIV)
B. Adjustable rate loans
C. FHA and VA loans
D. Loans with prepayment penalties
A. No Income Verification loans (NIV)
In a deed of trust, the power of sale in the event of default is given from the:
Select one:
A. Beneficiary to trustee
B. Trustor to the trustee
C. Buyer to the seller
D. Trustee to the beneficiary
B. Trustor to the trustee
Which of the following general loan types does HMDA NOT require financial institutions to
identify each calendar year?
Select one:
A. Conventional
B. FHA - insured
,C. VA - guaranteed
D. Construction loans
D. Construction loans
When can a creditor ask about an applicant's marital status?
Select one:
A. When the information is used to determine whether credit is extended
B. Never, asking such a question is considered discrimination
C. When the information is not used to determine whether credit will be extended
D. This information does not matter and creditors should not ask
C. When the information is not used to determine whether credit will be extended
The practice of sneaking a burdensome provision into the loan contract without the borrower's
knowledge is known as what?
Select one:
A. Equity Stripping
B. Steering
C. Contract Knavery
D. Price Gouging
C. Contract Knavery
Which of the following is NOT a TILA or RESPA mandated disclosure?
, Select one:
A. Closing Disclosure
B. Loan Estimate
C. Mortgage Servicing Disclosure
D. An Adverse Action Statement
D. An Adverse Action Statement
Which of the following does not affect a Veterans Funding fee?
Select one:
A. Loan Amount
B. Prior Service (Active/ Reserve)
C. Marital Status
D. Prior Use of Entitlement
C. Marital Status
AD
FACTA requires that if a lender uses credit scores in making or arranging loans that it must
provide certain information. Which of the following is not required?
Select one:
A. The range of possible credit scores under the model used
B. If any factors adversely affected the consumer's score, up to 4 key factors that adversely
affected the score (including inquiries)
C. Suggestions on how to improve credit scores
