NMLS MLO Exam
What must a borrower do to avoid having late payments reported to a credit bureau? -
ANSPay within 30 days of due date
Max penalty if a borrower is required to use a specific title company or settlement agent? -
ANS3 times the fee
What should not be over-weighted in an analysis of borrower repayment capacity? -
ANSCredit scores
Max prepayment penalty on residential mortgages in the first year of the loan - ANS3%
What must condominium associations do with respect to property insurance? - ANSKeep a
"blanket" policy that protects the entire structure
If a lender is planning on referring a borrower to a title company that the lender has
ownership in, when must the AFBA must be provided to the borrower? - ANSBefore the
referral to the title company is made
Website to obtain copy of your credit report that the credit bureaus are required to provide
once per year at no charge - ANSannualcreditreport.com
2/3/6 caps - ANSARM initial adjustment max is 2%, subsequent adjustment period max is
3%, and lifetime cap of 6%
What does FHLB stand for and what do they provide? - ANSFederal Home Loan Bank, and
they provide advances to financial institutions for residential mortgage loans
According to the Dodd-Frank Act, how much risk must be retained by the securitizer for a
loan that does not meet QRM guidelines? - ANS5%
On a purchase transaction, what document contains the purchase price for a property? -
ANSSales Contract
After a loan has been closed and funded, the creditor notices a tolerance violation with a fee
between the LE and CD. How long does the creditor have to reimburse the borrower for the
overcharge before being considered in violation of the TRID rule? - ANS60 days after closing
According to the Dodd-Frank Act, how much risk must be retained by the securitizer for a
loan that does not meet QRM guidelines? - ANS5%
Overt Discrimination - ANSRefusing service to anyone of a certain race, ethnicity, etc.
Under ECOA can you ask how many children a borrower has? - ANSNo
, What document specifies that a property is being used as security in the event of
nonpayment of a debt? - ANSMortgage
On the LE, which piece of data tells applicants how much they will be paying in interest over
the life of the loan as a percentage of the loan? - ANSTIP (Total Interest Percentage)
COFI comes from what region in the country? - ANSThe 11th Federal Home Loan Bank
(Arizona, California, and Nevada)
What disclosure is required to be provided to the applicant within 3 days of application under
reg x? - ANSMortgage Loan Servicing Disclosure
Verification of cash used in a closing is documented by: - ANSlast 2-3 months bank
statements
The finance charge is the total cost of: - ANSthe loan in dollars, including points and
mortgage insurance
What IRS forms would you requrest from a borrower who is 40% shareholder in a
C-Corporation? - ANSForm 1120
Impersonating someone else in an attempt to obtain their personal financial information is
called: - ANSPretexting
What type of funding occurs when a lender obtains funds from a line of credit at a
commercial bank? - ANSWarehouse funding
Late fee for FHA and VA loans - ANS4%
Ginnie Mae _____ loans - ANSGuarantees
A mortgage on personal property is: - ANSChattel mortgage
Who can transfer title insurance policy? - ANSMortgagee
What document is NOT recorded? - ANSThe Note
The borrower's IOU is: - ANSThe Note
Escheat - ANSWhen a property owner dies without a will and the state is unable to locate
any heirs, so the state claims the property.
Disintermediation - ANSThe withdrawal of funds out of savings accounts and into stocks and
bonds
Eminent Domain - ANSThe condemnation of private property for public good
What must a borrower do to avoid having late payments reported to a credit bureau? -
ANSPay within 30 days of due date
Max penalty if a borrower is required to use a specific title company or settlement agent? -
ANS3 times the fee
What should not be over-weighted in an analysis of borrower repayment capacity? -
ANSCredit scores
Max prepayment penalty on residential mortgages in the first year of the loan - ANS3%
What must condominium associations do with respect to property insurance? - ANSKeep a
"blanket" policy that protects the entire structure
If a lender is planning on referring a borrower to a title company that the lender has
ownership in, when must the AFBA must be provided to the borrower? - ANSBefore the
referral to the title company is made
Website to obtain copy of your credit report that the credit bureaus are required to provide
once per year at no charge - ANSannualcreditreport.com
2/3/6 caps - ANSARM initial adjustment max is 2%, subsequent adjustment period max is
3%, and lifetime cap of 6%
What does FHLB stand for and what do they provide? - ANSFederal Home Loan Bank, and
they provide advances to financial institutions for residential mortgage loans
According to the Dodd-Frank Act, how much risk must be retained by the securitizer for a
loan that does not meet QRM guidelines? - ANS5%
On a purchase transaction, what document contains the purchase price for a property? -
ANSSales Contract
After a loan has been closed and funded, the creditor notices a tolerance violation with a fee
between the LE and CD. How long does the creditor have to reimburse the borrower for the
overcharge before being considered in violation of the TRID rule? - ANS60 days after closing
According to the Dodd-Frank Act, how much risk must be retained by the securitizer for a
loan that does not meet QRM guidelines? - ANS5%
Overt Discrimination - ANSRefusing service to anyone of a certain race, ethnicity, etc.
Under ECOA can you ask how many children a borrower has? - ANSNo
, What document specifies that a property is being used as security in the event of
nonpayment of a debt? - ANSMortgage
On the LE, which piece of data tells applicants how much they will be paying in interest over
the life of the loan as a percentage of the loan? - ANSTIP (Total Interest Percentage)
COFI comes from what region in the country? - ANSThe 11th Federal Home Loan Bank
(Arizona, California, and Nevada)
What disclosure is required to be provided to the applicant within 3 days of application under
reg x? - ANSMortgage Loan Servicing Disclosure
Verification of cash used in a closing is documented by: - ANSlast 2-3 months bank
statements
The finance charge is the total cost of: - ANSthe loan in dollars, including points and
mortgage insurance
What IRS forms would you requrest from a borrower who is 40% shareholder in a
C-Corporation? - ANSForm 1120
Impersonating someone else in an attempt to obtain their personal financial information is
called: - ANSPretexting
What type of funding occurs when a lender obtains funds from a line of credit at a
commercial bank? - ANSWarehouse funding
Late fee for FHA and VA loans - ANS4%
Ginnie Mae _____ loans - ANSGuarantees
A mortgage on personal property is: - ANSChattel mortgage
Who can transfer title insurance policy? - ANSMortgagee
What document is NOT recorded? - ANSThe Note
The borrower's IOU is: - ANSThe Note
Escheat - ANSWhen a property owner dies without a will and the state is unable to locate
any heirs, so the state claims the property.
Disintermediation - ANSThe withdrawal of funds out of savings accounts and into stocks and
bonds
Eminent Domain - ANSThe condemnation of private property for public good
