NMLS (MLO) TEST STUDY Questions and Answers With Verified Solutions 2025
Which property is exempt under RESPA? - ✔✔25 acres or more
Which of the following is a purpose of RESPA? - ✔✔To eliminate kickback and referral fees
CFPB is the acronym for: - ✔✔Consumer Financial Protection Bureau.
Who provides the Annual Escrow Account Disclosure Statement? - ✔✔The Servicing Lender
What is a purpose of the Truth in Lending Act? - ✔✔To enable consumers to compare the cost of credit
from lender to lender
A Loan Estimate: - ✔✔should exhibit a reasonable relationship to the actual final settlement costs.
FCRA is the acronym for: - ✔✔Fair Credit Reporting Act.
The federal act that requires lenders to disclose mortgage loan information by geographic area is: -
✔✔HMDA.
FHA is the acronym for: - ✔✔Fair Housing Act
If a home is purchased with an FHA owner-occupied loan, what type of FHA refinance can the borrower
use to refinance? - ✔✔Streamline
What information is a mortgage loan originator not allowed to ask a borrower who is applying for a
home mortgage? - ✔✔Receipt of Public Assistance
Define "Business day" under the Truth in Lending Act for the three day right of rescission. - ✔✔Monday
through Saturday except legal public holidays
,Which of the following is an acceptable condition on which to base a mortgage loan originator's
compensation? - ✔✔A fixed percentage of the loan amount
What is the purpose of HMDA? - ✔✔To detect discriminatory lending
The following two disclosures are required by RESPA, if applicable: - ✔✔.LE and AfBA
A mortgage broker provides tickets to an NFL game to a title company executive for referring customers
to them. Which federal law does this arrangement violate? - ✔✔RESPA
When is an Affiliated Business Agreement required? - ✔✔At the time the borrower is referred to the
affiliated business partner
The Fair Credit Reporting Act covers all of the following EXCEPT: - ✔✔prohibiting discrimination
regarding the handicapped.
ECOA is also a part of what Reg.: - ✔✔B
TILA does not apply to which of the following: - ✔✔Commercial loans
The CHARM booklet was prepared by: - ✔✔the CFPB.
Which of the following must be provided to the client on an ARM loan? - ✔✔The CHARM Handbook
An MLO provides the borrower a Loan Estimate in her office the day after the application was
completed, the borrower signs all disclosures and verbally tells the MLO they are ready to proceed with
the loan. The loan originator can charge the borrower for an appraisal: - ✔✔That day
When can a lender collect a loan origination fee? - ✔✔When the loan closes
,Which rule requires all financial institutions to design, implement, and maintain safeguards to protect
customer information while it is in the custody and control of the institution and its agents? - ✔✔The
Safeguard Rule
After meeting with the borrowers to complete a loan application, you return to your office and order a
Tri-Merged credit report. Now that you have a credit report, what Loan Disclosure must you now
prepare and mail (or give) to them? - ✔✔Notice to Home Loan Applicant
HMDA requires the lenders to obtain what information for each borrower? - ✔✔Race and Sex
You and the borrower believe an Adjustable Rate Mortgage would be best for the borrower. What is the
name of the booklet you are required to give? - ✔✔CHARM Booklet
Which rule dictates how instructions are required to dispose of consumer's information? - ✔✔The
Disposal Rule
The Borrower is entitled to the disclosure of the costs of a mortgage loan through the Loan Estimate: -
✔✔within three business days of the loan application.
The responsibility of financial institutions to meet both the deposit and credit needs of the community,
including the needs of low-income families, is called? - ✔✔the Community Reinvestment Act.
Which of the following is NOT calculated into the APR? - ✔✔Realtor's commission
If a loan originator is in a face-to-face loan interview with the applicant, and the applicant does not wish
to answer the questions in Section 10 on the 1003 , the loan officer must: - ✔✔fill out the information
based on visual observation.
Who of the following would be an appropriate person to discuss the borrower's credit with to determine
whether they qualify for the proposed loan or not? - ✔✔Underwriter
, According to the Fair and Accurate Credit Transaction Act, when are borrowers entitled to get a copy of
their credit scores? - ✔✔Once a year
In compliance with the general provisions of Regulation Z, how long is a lender required to maintain
records? - ✔✔2 years.
An MLO purchases tickets for a sporting event and provides those tickets to a local real estate agent as a
thank you for a referral and also in the hopes that that real estate agent will continue to send clients,
this would be considered: - ✔✔An illegal practice
What law requires the lender to collect a borrower's demographic information for first mortgages and
home improvement loans? - ✔✔HMDA
An MLO is required to protect a borrower's non-public personal information, per what federal law? -
✔✔Regulation P
An MLO is looking over a borrower's credit report and sees a fraud alert, under the Economic Growth,
Regulatory Relief and Consumer Protection Act, how long can a fraud alert be on a borrower's credit
report? - ✔✔1 year
RESPA does not apply to: - ✔✔Vacant Land
Which is not a disclosure required within 3 business days of receiving an application? -
✔✔Environmental hazard disclosure
Dodd-Frank mandated which of the following rules that now appear under TILA: - ✔✔Qualified
Mortgage
How many days in advance of transferring a loan to another lender must the current mortgage servicer
inform that customer of the transfer to another lender who will subsequently be servicing the loan? -
✔✔15
Which property is exempt under RESPA? - ✔✔25 acres or more
Which of the following is a purpose of RESPA? - ✔✔To eliminate kickback and referral fees
CFPB is the acronym for: - ✔✔Consumer Financial Protection Bureau.
Who provides the Annual Escrow Account Disclosure Statement? - ✔✔The Servicing Lender
What is a purpose of the Truth in Lending Act? - ✔✔To enable consumers to compare the cost of credit
from lender to lender
A Loan Estimate: - ✔✔should exhibit a reasonable relationship to the actual final settlement costs.
FCRA is the acronym for: - ✔✔Fair Credit Reporting Act.
The federal act that requires lenders to disclose mortgage loan information by geographic area is: -
✔✔HMDA.
FHA is the acronym for: - ✔✔Fair Housing Act
If a home is purchased with an FHA owner-occupied loan, what type of FHA refinance can the borrower
use to refinance? - ✔✔Streamline
What information is a mortgage loan originator not allowed to ask a borrower who is applying for a
home mortgage? - ✔✔Receipt of Public Assistance
Define "Business day" under the Truth in Lending Act for the three day right of rescission. - ✔✔Monday
through Saturday except legal public holidays
,Which of the following is an acceptable condition on which to base a mortgage loan originator's
compensation? - ✔✔A fixed percentage of the loan amount
What is the purpose of HMDA? - ✔✔To detect discriminatory lending
The following two disclosures are required by RESPA, if applicable: - ✔✔.LE and AfBA
A mortgage broker provides tickets to an NFL game to a title company executive for referring customers
to them. Which federal law does this arrangement violate? - ✔✔RESPA
When is an Affiliated Business Agreement required? - ✔✔At the time the borrower is referred to the
affiliated business partner
The Fair Credit Reporting Act covers all of the following EXCEPT: - ✔✔prohibiting discrimination
regarding the handicapped.
ECOA is also a part of what Reg.: - ✔✔B
TILA does not apply to which of the following: - ✔✔Commercial loans
The CHARM booklet was prepared by: - ✔✔the CFPB.
Which of the following must be provided to the client on an ARM loan? - ✔✔The CHARM Handbook
An MLO provides the borrower a Loan Estimate in her office the day after the application was
completed, the borrower signs all disclosures and verbally tells the MLO they are ready to proceed with
the loan. The loan originator can charge the borrower for an appraisal: - ✔✔That day
When can a lender collect a loan origination fee? - ✔✔When the loan closes
,Which rule requires all financial institutions to design, implement, and maintain safeguards to protect
customer information while it is in the custody and control of the institution and its agents? - ✔✔The
Safeguard Rule
After meeting with the borrowers to complete a loan application, you return to your office and order a
Tri-Merged credit report. Now that you have a credit report, what Loan Disclosure must you now
prepare and mail (or give) to them? - ✔✔Notice to Home Loan Applicant
HMDA requires the lenders to obtain what information for each borrower? - ✔✔Race and Sex
You and the borrower believe an Adjustable Rate Mortgage would be best for the borrower. What is the
name of the booklet you are required to give? - ✔✔CHARM Booklet
Which rule dictates how instructions are required to dispose of consumer's information? - ✔✔The
Disposal Rule
The Borrower is entitled to the disclosure of the costs of a mortgage loan through the Loan Estimate: -
✔✔within three business days of the loan application.
The responsibility of financial institutions to meet both the deposit and credit needs of the community,
including the needs of low-income families, is called? - ✔✔the Community Reinvestment Act.
Which of the following is NOT calculated into the APR? - ✔✔Realtor's commission
If a loan originator is in a face-to-face loan interview with the applicant, and the applicant does not wish
to answer the questions in Section 10 on the 1003 , the loan officer must: - ✔✔fill out the information
based on visual observation.
Who of the following would be an appropriate person to discuss the borrower's credit with to determine
whether they qualify for the proposed loan or not? - ✔✔Underwriter
, According to the Fair and Accurate Credit Transaction Act, when are borrowers entitled to get a copy of
their credit scores? - ✔✔Once a year
In compliance with the general provisions of Regulation Z, how long is a lender required to maintain
records? - ✔✔2 years.
An MLO purchases tickets for a sporting event and provides those tickets to a local real estate agent as a
thank you for a referral and also in the hopes that that real estate agent will continue to send clients,
this would be considered: - ✔✔An illegal practice
What law requires the lender to collect a borrower's demographic information for first mortgages and
home improvement loans? - ✔✔HMDA
An MLO is required to protect a borrower's non-public personal information, per what federal law? -
✔✔Regulation P
An MLO is looking over a borrower's credit report and sees a fraud alert, under the Economic Growth,
Regulatory Relief and Consumer Protection Act, how long can a fraud alert be on a borrower's credit
report? - ✔✔1 year
RESPA does not apply to: - ✔✔Vacant Land
Which is not a disclosure required within 3 business days of receiving an application? -
✔✔Environmental hazard disclosure
Dodd-Frank mandated which of the following rules that now appear under TILA: - ✔✔Qualified
Mortgage
How many days in advance of transferring a loan to another lender must the current mortgage servicer
inform that customer of the transfer to another lender who will subsequently be servicing the loan? -
✔✔15
