MLO test| 110 questions| WITH COMPLETE SOLUTIONS

A mortgage broker also owns a title company Is this business arrangement allowed by RESPA? A. No, this is considered a business conflict of interest. B. No, this is an illegal business arrangement. C. Yes, as long as the title company is legitimate and the arrangement is disclosed. D. Yes, but the two affiliations can never be involved in a single real estate transaction. Correct Answer: C Yes, as long as the title company is legitimate and the arrangement is disclosed. 2 The minimum down payment contribution needed for a home with an FHA-appraised value of $132,000 (assuming appropriate FICO score) is A. $0. B. $4,620. C. $6,600. D. $26,400. Correct Answer: B $4,620. 3 As a mortgage broker puts together an ad to attract some new customers, what law should he be most concerned about? A. FACTA B. NAMB C. RESPA D. TILA Correct Answer: D TILA 4 Of these loans, which would require reporting under the Home Mortgage Disclosure Act? A. home equity lines of credit B. loans purchased for the purpose of servicing those loans C. new construction loans D. vacant land loans Correct Answer: A home equity lines of credit 5 For a loan that has escrow included, RESPA requires a lender to perform an escrow analysis A. monthly. B. quarterly. C. semi-annually. D. annually. Correct Answer: D Annually 6 A borrower elects to lower his settlement costs by paying a slightly higher interest rate This appears on the GFE as a A. charge to the borrower. B. charge to the mortgage broker. C. credit to the borrower. D. credit to the lender. Correct Answer: C Credit to the borrower. 7 A seller agrees to pay two points on a buyer's loan The price is $60,000 and the buyer is making a 20% down payment Two points equal