NMLS SAFE MORTGAGE LOAN
ORIGINATOR EXAM 2027 QUESTIONS
AND ANSWERS
1. According to the Truth in Lending Act (TILA), a ‘business day’ for the purpose of the Right of
Rescission is defined as:
A. Any day the lender’s offices are open to the public for business.
B. Monday through Friday, excluding Saturdays, Sundays, and federal holidays.
C. All calendar days except Sundays and legal public holidays.
D. Every day including Sundays and legal holidays if the lender is open.
Answer: C
Conceptual Explanation: For the Right of Rescission under TILA, a business day includes
all calendar days except Sundays and federal legal holidays. This differs from the definition
used for the initial Loan Estimate delivery.
2. Under the Equal Credit Opportunity Act (ECOA), how long must a lender retain records of a
mortgage loan application?
A. 12 months
,B. 5 years
C. 3 years
D. 25 months
Answer: D
Conceptual Explanation: Regulation B (ECOA) requires that mortgage loan records be
retained for 25 months after the date the applicant is notified of the action taken.
3. Which of the following is considered a ‘Trigger Term’ in an advertisement under Regulation
Z?
A. ‘Low down payment’
B. ‘10% down payment’
C. ‘Competitive rates available’
D. ‘Terms to fit your budget’
Answer: B
Conceptual Explanation: Regulation Z states that if specific credit terms (like a numerical
down payment percentage, number of payments, or the amount of any finance charge) are
mentioned, full disclosure of terms is required.
4. An MLO takes an application but fails to provide the Loan Estimate. The loan eventually
closes. Which regulation has been violated?
A. RESPA Section 8
, B. Fair Credit Reporting Act (FCRA)
C. Home Mortgage Disclosure Act (HMDA)
D. TILA-RESPA Integrated Disclosure (TRID) Rule
Answer: D
Conceptual Explanation: The TRID rule, implemented under TILA and RESPA, mandates
the delivery of the Loan Estimate within three business days of application.
5. A loan is considered ‘Higher-Priced’ (HPML) if the APR exceeds the APOR by how much for
a first-lien jumbo loan?
A. 2.5 percentage points
B. 1.5 percentage points
C. 3.5 percentage points
D. 6.5 percentage points
Answer: A
Conceptual Explanation: For a first-lien jumbo loan, the threshold for a Higher-Priced
Mortgage Loan is 2.5 percentage points above the Average Prime Offer Rate (APOR). It is
1.5 for standard first-liens and 3.5 for subordinate liens.
6. What is the maximum penalty for a single violation of the SAFE Act?
A. $36,056
B. $25,000
ORIGINATOR EXAM 2027 QUESTIONS
AND ANSWERS
1. According to the Truth in Lending Act (TILA), a ‘business day’ for the purpose of the Right of
Rescission is defined as:
A. Any day the lender’s offices are open to the public for business.
B. Monday through Friday, excluding Saturdays, Sundays, and federal holidays.
C. All calendar days except Sundays and legal public holidays.
D. Every day including Sundays and legal holidays if the lender is open.
Answer: C
Conceptual Explanation: For the Right of Rescission under TILA, a business day includes
all calendar days except Sundays and federal legal holidays. This differs from the definition
used for the initial Loan Estimate delivery.
2. Under the Equal Credit Opportunity Act (ECOA), how long must a lender retain records of a
mortgage loan application?
A. 12 months
,B. 5 years
C. 3 years
D. 25 months
Answer: D
Conceptual Explanation: Regulation B (ECOA) requires that mortgage loan records be
retained for 25 months after the date the applicant is notified of the action taken.
3. Which of the following is considered a ‘Trigger Term’ in an advertisement under Regulation
Z?
A. ‘Low down payment’
B. ‘10% down payment’
C. ‘Competitive rates available’
D. ‘Terms to fit your budget’
Answer: B
Conceptual Explanation: Regulation Z states that if specific credit terms (like a numerical
down payment percentage, number of payments, or the amount of any finance charge) are
mentioned, full disclosure of terms is required.
4. An MLO takes an application but fails to provide the Loan Estimate. The loan eventually
closes. Which regulation has been violated?
A. RESPA Section 8
, B. Fair Credit Reporting Act (FCRA)
C. Home Mortgage Disclosure Act (HMDA)
D. TILA-RESPA Integrated Disclosure (TRID) Rule
Answer: D
Conceptual Explanation: The TRID rule, implemented under TILA and RESPA, mandates
the delivery of the Loan Estimate within three business days of application.
5. A loan is considered ‘Higher-Priced’ (HPML) if the APR exceeds the APOR by how much for
a first-lien jumbo loan?
A. 2.5 percentage points
B. 1.5 percentage points
C. 3.5 percentage points
D. 6.5 percentage points
Answer: A
Conceptual Explanation: For a first-lien jumbo loan, the threshold for a Higher-Priced
Mortgage Loan is 2.5 percentage points above the Average Prime Offer Rate (APOR). It is
1.5 for standard first-liens and 3.5 for subordinate liens.
6. What is the maximum penalty for a single violation of the SAFE Act?
A. $36,056
B. $25,000
