NMLS PRACTICE TEST HARD EXAM
2025/2026 QUESTIONS AND ANSWERS
100% PASS
A discount point is BEST described as a charge the borrower pays to:
A.) A lender to decrease the interest rate on the mortgage loan
B.) A mortgage broker at the time of application to obtain a favorable rate
C.) The seller as part of the closing costs of a loan
D.) A lender to ensure against foreclosure - ANS A.) A lender to decrease the interest rate on
the mortgage loan
A buyer has made an earnest money payment of $5,000. The buyer pays an additional $2,000 in
option money to be credited at closing on property with sale price of $160,000. If the required
down payment is 20%, how much additional money will the buyer need to provide toward the
down payment at closing?
A.) $32,000
B.) $27,000
C.) $30,000
D.) $25,000 - ANS D.) $25,000
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
,$160,000 x .20 (20%) = 32000 - $7,000 = $25,000
If an applicant works 40 hours every week and is paid $13.52 per hour, what is the applicant's
monthly income?
A.) $2,163.20
B.) $2,343.47
C.) $2,379.52
D.) $2,487.68 - ANS B.) $2,343.47
$13.52x 40 hours = $540.8 x 52 weeks = $28,121.6 annually /12month = $2,343.47 Monthly
income
The requirement for private mortgage insurance is generally is continued when the loan-to-
value ratio falls below:
A.) 20%
B.) 50%
C.) 80%
D.) 90% - ANS C.) 80%
Which of the following documents itemizes all settlement costs including lender charges?
A.) Agreement of sale
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, B.) HUD-1/closing Disclosure
C.) Form 1003
D.) Forbearance agreement - ANS B.) HUD-1/closing Disclosure
According to the Truth-in-Lending Act (TILA), the term "refinance" applies to
A.) A change in a payment schedule
B.) A reduction in annual percentage rate
C.) The renewal of a single payment obligation with no change in the original terms
D.) The satisfaction of an existing obligation and its replacement by a new obligation - ANS D.)
The satisfaction of an existing obligation and its replacement by a new obligation
What does a loan originator use to determine the estimated value of a property based on an
analytical comparison of similar property sales?
A.) An appraisal
B.) A market survey
C.) An area survey
D.) A Cost-benefit analysis - ANS A.) An appraisal
Which of the following methods of disclosure does NOT meet the requirements of Equal Credit
Opportunity Act (ECOA)?
A.) E-mail
B.) Mailed letter
C.) Telephone
D.) Faxed letter - ANS C.) Telephone
3 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
2025/2026 QUESTIONS AND ANSWERS
100% PASS
A discount point is BEST described as a charge the borrower pays to:
A.) A lender to decrease the interest rate on the mortgage loan
B.) A mortgage broker at the time of application to obtain a favorable rate
C.) The seller as part of the closing costs of a loan
D.) A lender to ensure against foreclosure - ANS A.) A lender to decrease the interest rate on
the mortgage loan
A buyer has made an earnest money payment of $5,000. The buyer pays an additional $2,000 in
option money to be credited at closing on property with sale price of $160,000. If the required
down payment is 20%, how much additional money will the buyer need to provide toward the
down payment at closing?
A.) $32,000
B.) $27,000
C.) $30,000
D.) $25,000 - ANS D.) $25,000
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
,$160,000 x .20 (20%) = 32000 - $7,000 = $25,000
If an applicant works 40 hours every week and is paid $13.52 per hour, what is the applicant's
monthly income?
A.) $2,163.20
B.) $2,343.47
C.) $2,379.52
D.) $2,487.68 - ANS B.) $2,343.47
$13.52x 40 hours = $540.8 x 52 weeks = $28,121.6 annually /12month = $2,343.47 Monthly
income
The requirement for private mortgage insurance is generally is continued when the loan-to-
value ratio falls below:
A.) 20%
B.) 50%
C.) 80%
D.) 90% - ANS C.) 80%
Which of the following documents itemizes all settlement costs including lender charges?
A.) Agreement of sale
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, B.) HUD-1/closing Disclosure
C.) Form 1003
D.) Forbearance agreement - ANS B.) HUD-1/closing Disclosure
According to the Truth-in-Lending Act (TILA), the term "refinance" applies to
A.) A change in a payment schedule
B.) A reduction in annual percentage rate
C.) The renewal of a single payment obligation with no change in the original terms
D.) The satisfaction of an existing obligation and its replacement by a new obligation - ANS D.)
The satisfaction of an existing obligation and its replacement by a new obligation
What does a loan originator use to determine the estimated value of a property based on an
analytical comparison of similar property sales?
A.) An appraisal
B.) A market survey
C.) An area survey
D.) A Cost-benefit analysis - ANS A.) An appraisal
Which of the following methods of disclosure does NOT meet the requirements of Equal Credit
Opportunity Act (ECOA)?
A.) E-mail
B.) Mailed letter
C.) Telephone
D.) Faxed letter - ANS C.) Telephone
3 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
