MLO SAFE NMLS EXAM STUDY GUIDE |ACTUAL
QUESTIONS AND VERIFIED ANSWERS |LATEST
2026/2027 UPDATE|GRADED A+
Question 1
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 __________________________.
ANSWER
Predatory Lending.
Question 2
RESPA-Real Estate Settlement Procedures Act
ANSWER
The Federal Statute that deals with the settlement of residential mortgage loans.
Question 3
RESPA's section 9 Prohibits
ANSWER
Home sellers from requiring home buyers to purchase title insurance from a particular
company providing title services.
Question 4
Per the Dodd-Frank Acvt, to be a "qualified mortgage" total points and fees may not exceed
________% of the total loan amount.
1
@THE STUDY VAULT
,ANSWER
3% (three percent)
Question 5
TIL (Truth In Lending Disclosure) & GFE (Good Faith Estimate)
ANSWER
Per the Dodd Frank Act, a single disclosure form combines these 2 statements.
Question 6
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.
ANSWER
upon completion and 3 business days
Question 7
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?
ANSWER
All loans, whether owner occupied or not.
Question 8
A loan subject to HOEPA allows prepayment penalties for the first ______ years of the loan.
ANSWER
2
@THE STUDY VAULT
,2 (two) years
Question 9
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.
ANSWER
All three would be considered abusive acts.
Question 10
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?
ANSWER
$0.00, dual compensation is not allowed. Compensation must be borrower paid or lender
paid.
Question 11
What kinds of reasons are necessary for a lender to take adverse action with regard to a
borrower?
ANSWER
Specific reasons.
3
@THE STUDY VAULT
, Question 12
Per Regulation B, Lenders should retain certain records for _____________ months.
ANSWER
25 Months
Question 13
Adverse action means ______________________.
ANSWER
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.
Question 14
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.
ANSWER
APOR ( Average Prime Offer Rate), 8.5%
Question 15
Regulation C is known as ________________________.
ANSWER
HMDA, The Home Mortgage Disclosure Act.
Question 16
What is the purpose of HMDA?
4
@THE STUDY VAULT
QUESTIONS AND VERIFIED ANSWERS |LATEST
2026/2027 UPDATE|GRADED A+
Question 1
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 __________________________.
ANSWER
Predatory Lending.
Question 2
RESPA-Real Estate Settlement Procedures Act
ANSWER
The Federal Statute that deals with the settlement of residential mortgage loans.
Question 3
RESPA's section 9 Prohibits
ANSWER
Home sellers from requiring home buyers to purchase title insurance from a particular
company providing title services.
Question 4
Per the Dodd-Frank Acvt, to be a "qualified mortgage" total points and fees may not exceed
________% of the total loan amount.
1
@THE STUDY VAULT
,ANSWER
3% (three percent)
Question 5
TIL (Truth In Lending Disclosure) & GFE (Good Faith Estimate)
ANSWER
Per the Dodd Frank Act, a single disclosure form combines these 2 statements.
Question 6
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.
ANSWER
upon completion and 3 business days
Question 7
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?
ANSWER
All loans, whether owner occupied or not.
Question 8
A loan subject to HOEPA allows prepayment penalties for the first ______ years of the loan.
ANSWER
2
@THE STUDY VAULT
,2 (two) years
Question 9
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.
ANSWER
All three would be considered abusive acts.
Question 10
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?
ANSWER
$0.00, dual compensation is not allowed. Compensation must be borrower paid or lender
paid.
Question 11
What kinds of reasons are necessary for a lender to take adverse action with regard to a
borrower?
ANSWER
Specific reasons.
3
@THE STUDY VAULT
, Question 12
Per Regulation B, Lenders should retain certain records for _____________ months.
ANSWER
25 Months
Question 13
Adverse action means ______________________.
ANSWER
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.
Question 14
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.
ANSWER
APOR ( Average Prime Offer Rate), 8.5%
Question 15
Regulation C is known as ________________________.
ANSWER
HMDA, The Home Mortgage Disclosure Act.
Question 16
What is the purpose of HMDA?
4
@THE STUDY VAULT
