MLO TEST| 998 Questions with Complete Solutions | A+ Grade

1.The practice of getting people to sell their homes at bargain prices by suggesting that certain ethnic groups are going to move into the area is nicknamed: 1.Price fixing 2.Redlining 3.Steering 4.Blockbusting - Correct Choice:4 2.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? 1.CHARM Booklet 2.ARM Disclosure 3.Fair Lending Practices Booklet 4.RESPA Booklet - Correct Choice:1 3.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? 1.15 2.20 3.3 4.45 - Correct Choice:1 4.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? 1.Notice to Home Loan Applicant 2.Credit Authorization Consent 3.Denial Letter 4.Rapid Rescore - Correct Choice:15.In a face-to-face application, what do you do if the borrower refuses to fill out the race, ethnicity and gender section on Section X of the 1003? 1.Continue with the loan application, but be sure to get the information completed before submitting the loan to the underwriter. 2.Process and complete the loan entirely without the information. 3.Use your best guess and complete the information in Section X of the 1003. 4.End the application process. - Correct Choice:3 6.Which is not part of the original loan application? 1.Borrower's marital status 2.ECOA disclosure 3.Borrower provided ethnicity 4.Borrower provided birth date - Correct Choice:2 7.Which is not an application disclosure? 1.Servicing disclosure 2.Environmental hazard disclosure 3.Appraisal disclosure 4.APR disclosure - Correct Choice:2 8.How many days prior to this loan transfer does the current mortgage servicer have to inform the customer? 1.15 2.20 3.3 4.45 - Correct Choice:1 9.What is not likely to happen if the lender/investor finds fraud? 1.A 1% interest rate increase on the loan 2.The lender and/or broker will be required to repurchase the loan 3.The entire loan can be called due and payable4.The loan officer must pay back any premium made on the loan - Correct Choice:1 10.What is the maximum penalty for providing false information on a federally related loan? 1.$5,000 fine and one year jail time 2.$250,000 fine and 30 years jail time 3.Revoke license and $1,000 fine 4.Up to $1,000,000 fine and jail time - Correct Choice:4 11.What law requires the lender to collect borrower information for first mortgages and home improvement loans? 1.HOEPA 2.TILA 3.ECOA 4.HMDA - Correct Choice:4 12.HMDA requires the lenders to obtain which of the following information for each borrower? 1.Age and Race 2.Race and Sex 3.Marital status and Sex 4.Marital status and Age - Correct Choice:2 13.Providing a referral fee to a realtor is? 1.An acceptable practice 2.An illegal practice 3.An acceptable practice as long as it is a fair price for services actually provided 4.Acceptable only if fully disclosed - Correct Choice:2 14.What are the penalties for giving a referral fee to a realtor? 1.There are no penalties. 2.$10,000 per incident and up to one year in jail 3.$100,000 plus up to 30 years in jail 4.$1,000,000 plus up to one year in jail - Correct Choice:2