RMLO Exam Prep Questions & Answers
Churning Correct Ans-excessive lending activity for the purpose of generating fees and
commissions
- multiple refinances
Chunking Correct Ans-when a third party convinces an uninformed borrower to invest in a
property, with no money down and with the third party acting as the borrowers agent
Equity Theft Correct Ans-fraudsters forge a deed or a satisfaction of lien
- foreclosure rescue scam
foreclosure rescue scams Correct Ans-homeowner is deceived into signing over title to the
property with the belief that he or she will be able to remain in the house as a renter and
eventually buy it back over time.
Property Flipping Correct Ans-A recently acquired property is resold for a considerable profit
with an artificially inflated value
Straw Buyer Correct Ans-person who is used to buy a property in order to conceal the actual
owner
, Stated Income / Stated Asset Abuse Correct Ans-Often called the "liar loan". When
borrowers can't qualify for a loan using actual income and assets, loans are converted to SISA
program. The result is that borrowers are put into homes they can't afford and eventually lose
the home and any equity.
Penalty for Mortgage Fraud Correct Ans-$1M, 30 yr prison, or both
Annual Renewal Period Correct Ans-November 1 through December 31
Nontraditional Mortgage Product Correct Ans-Any mortgage product other than a 30 year
fixed rate mortgage
Hours needed for Federal Law and Regulation Correct Ans-3 hrs
Hours needed of Ethics Correct Ans-3 hrs
Hours needed for Nontraditional Mortgages Correct Ans-2 hrs
Hours needed on NMLSR defined instruction on mortgage origination Correct Ans-12 hrs
8 hours of CE Correct Ans-- 3 hrs of Fed Law
- 2 hrs of Ethics
Churning Correct Ans-excessive lending activity for the purpose of generating fees and
commissions
- multiple refinances
Chunking Correct Ans-when a third party convinces an uninformed borrower to invest in a
property, with no money down and with the third party acting as the borrowers agent
Equity Theft Correct Ans-fraudsters forge a deed or a satisfaction of lien
- foreclosure rescue scam
foreclosure rescue scams Correct Ans-homeowner is deceived into signing over title to the
property with the belief that he or she will be able to remain in the house as a renter and
eventually buy it back over time.
Property Flipping Correct Ans-A recently acquired property is resold for a considerable profit
with an artificially inflated value
Straw Buyer Correct Ans-person who is used to buy a property in order to conceal the actual
owner
, Stated Income / Stated Asset Abuse Correct Ans-Often called the "liar loan". When
borrowers can't qualify for a loan using actual income and assets, loans are converted to SISA
program. The result is that borrowers are put into homes they can't afford and eventually lose
the home and any equity.
Penalty for Mortgage Fraud Correct Ans-$1M, 30 yr prison, or both
Annual Renewal Period Correct Ans-November 1 through December 31
Nontraditional Mortgage Product Correct Ans-Any mortgage product other than a 30 year
fixed rate mortgage
Hours needed for Federal Law and Regulation Correct Ans-3 hrs
Hours needed of Ethics Correct Ans-3 hrs
Hours needed for Nontraditional Mortgages Correct Ans-2 hrs
Hours needed on NMLSR defined instruction on mortgage origination Correct Ans-12 hrs
8 hours of CE Correct Ans-- 3 hrs of Fed Law
- 2 hrs of Ethics
