Loan Originator Practice Exam 3 Questions Fully Solved Latest Update 2025
After a borrower allows the assumption of his or her VA loan, he or she may use his or her VA privilege
again only after: - Answers The answer is the original VA loan is satisfied. A VA loan is assumable;
however, the veteran's VA eligibility is no longer available until the original VA loan has been satisfied.
This means that it is paid off, either over the remaining amortization time period, sale of the home, or
refinancing out of the VA loan.
In order for a small creditor to originate a balloon payment qualified mortgage, the small creditor must
hold the loan in its portfolio for: - Answers The answer is three years. In order for a small creditor to
originate a balloon payment qualified mortgage, the small creditor must hold the loan in its portfolio for
three years.
"Mortgage loan originator Trevor Tibbs has accepted a loan application for a dwelling that is a mobile
home not permanently affixed to the land. Does this mobile home meet the requirements necessary for
it to be considered security for a residential mortgage loan?
Yes, a dwelling includes a structure whether or not that structure is attached to real property
No, dwellings must be permanently attached to real property
No, mobile homes are classified as personal property, not real property
Yes, as long as the real property upon which the mobile home will be located is in the borrower's name,
the loan may be a residential mortgage loan" - Answers The answer is yes, a dwelling includes a
structure whether or not that structure is attached to real property. A residential mortgage loan is any
loan primarily for personal, family or household use that is secured by a mortgage, deed of trust or other
equivalent consensual security interest on a dwelling or residential real estate upon which is constructed
or will be constructed a dwelling. A dwelling is a residential structure that contains one to four units,
whether or not that structure is attached to real property. The term includes an individual condominium
unit, cooperative unit, mobile home and trailer, if it is used as a residence.
Lester is calculating prepaid finance charges that will be withheld from the proceeds of the loan. These
direct loan charges paid by the borrower must be included in computing the: - Answers The answer is
annual percentage rate. A prepaid finance charge is any finance charge paid separately, in cash or by
check, before or at the consummation of a transaction or withheld from the proceeds of the loan at any
time. They are direct loan charges paid by the borrower that must be included in computing the annual
percentage rate.
When a seller provides all or part of the financing for the borrower in order to finance a purchase
transaction, it is known as: - Answers The answer is seller carry-back. In a purchase transaction involving
an assumable mortgage, when the party selling the property provides all or part of the financing, it is
referred to as a seller carry-back.
, "Which of the following is not a prohibited practice regarding loan originator compensation?
A loan originator receives .5% more compensation if a loan contains a prepayment penalty
A loan originator receives compensation for closing over $1 million in volume per month
A loan originator receives 10% more compensation if he/she closes more than ten transactions in a
month with an interest rate of 6.5% or more
A loan originator receives compensation from a consumer and from the creditor" - Answers The answer
is a loan originator receives compensation for closing over $1 million in volume per month. A loan
originator is prohibited from receiving compensation based on the terms of a loan, such as prepayment
penalties or interest rates, and is prohibited from receiving dual compensation (i.e., from both the
consumer and the creditor).
Which section of the URLA contains questions which, depending on the applicant's answer, could result
in immediate rejection of the application? - Answers The answer is declarations. The "Declarations"
section of the URLA contains questions which, depending on the applicant's answer, could result in
immediate rejection of the application.
"Which of the following would be a red flag concerning occupancy?
The borrowers already own and reside in a property in the same neighborhood
The subject property is in another state
The borrower has not moved in within ten days after closing
The property is three hours away and being declared as a second home" - Answers The answer is the
borrowers already own and reside in a property in the same neighborhood. A borrower is unlikely to
purchase a new primary residence in the same neighborhood as his/her current residence, unless one of
the two will be an investment property, or he/she may be planning to let the old home go into
foreclosure after purchasing the new home at current market values.
In January of 2021, Wella and Kip agreed to purchase a home at a purchase price of $584,150. They
would like to hold on to as much of their savings as they can, but they have chosen to make a down
payment sufficient enough to qualify for a conforming loan. What is the minimum down payment they
can make to reach the conforming loan limit but still retain savings? - Answers The answer is $35,900.
The down payment in this scenario will be $35,900. This is just enough to keep them at the $548,250
conforming loan limit which was adjusted January 1, 2021. 584,150-548,250 = 35,900.
"The Nationwide Multistate Licensing System and Registry seeks to accomplish all of the following
objectives, except:
After a borrower allows the assumption of his or her VA loan, he or she may use his or her VA privilege
again only after: - Answers The answer is the original VA loan is satisfied. A VA loan is assumable;
however, the veteran's VA eligibility is no longer available until the original VA loan has been satisfied.
This means that it is paid off, either over the remaining amortization time period, sale of the home, or
refinancing out of the VA loan.
In order for a small creditor to originate a balloon payment qualified mortgage, the small creditor must
hold the loan in its portfolio for: - Answers The answer is three years. In order for a small creditor to
originate a balloon payment qualified mortgage, the small creditor must hold the loan in its portfolio for
three years.
"Mortgage loan originator Trevor Tibbs has accepted a loan application for a dwelling that is a mobile
home not permanently affixed to the land. Does this mobile home meet the requirements necessary for
it to be considered security for a residential mortgage loan?
Yes, a dwelling includes a structure whether or not that structure is attached to real property
No, dwellings must be permanently attached to real property
No, mobile homes are classified as personal property, not real property
Yes, as long as the real property upon which the mobile home will be located is in the borrower's name,
the loan may be a residential mortgage loan" - Answers The answer is yes, a dwelling includes a
structure whether or not that structure is attached to real property. A residential mortgage loan is any
loan primarily for personal, family or household use that is secured by a mortgage, deed of trust or other
equivalent consensual security interest on a dwelling or residential real estate upon which is constructed
or will be constructed a dwelling. A dwelling is a residential structure that contains one to four units,
whether or not that structure is attached to real property. The term includes an individual condominium
unit, cooperative unit, mobile home and trailer, if it is used as a residence.
Lester is calculating prepaid finance charges that will be withheld from the proceeds of the loan. These
direct loan charges paid by the borrower must be included in computing the: - Answers The answer is
annual percentage rate. A prepaid finance charge is any finance charge paid separately, in cash or by
check, before or at the consummation of a transaction or withheld from the proceeds of the loan at any
time. They are direct loan charges paid by the borrower that must be included in computing the annual
percentage rate.
When a seller provides all or part of the financing for the borrower in order to finance a purchase
transaction, it is known as: - Answers The answer is seller carry-back. In a purchase transaction involving
an assumable mortgage, when the party selling the property provides all or part of the financing, it is
referred to as a seller carry-back.
, "Which of the following is not a prohibited practice regarding loan originator compensation?
A loan originator receives .5% more compensation if a loan contains a prepayment penalty
A loan originator receives compensation for closing over $1 million in volume per month
A loan originator receives 10% more compensation if he/she closes more than ten transactions in a
month with an interest rate of 6.5% or more
A loan originator receives compensation from a consumer and from the creditor" - Answers The answer
is a loan originator receives compensation for closing over $1 million in volume per month. A loan
originator is prohibited from receiving compensation based on the terms of a loan, such as prepayment
penalties or interest rates, and is prohibited from receiving dual compensation (i.e., from both the
consumer and the creditor).
Which section of the URLA contains questions which, depending on the applicant's answer, could result
in immediate rejection of the application? - Answers The answer is declarations. The "Declarations"
section of the URLA contains questions which, depending on the applicant's answer, could result in
immediate rejection of the application.
"Which of the following would be a red flag concerning occupancy?
The borrowers already own and reside in a property in the same neighborhood
The subject property is in another state
The borrower has not moved in within ten days after closing
The property is three hours away and being declared as a second home" - Answers The answer is the
borrowers already own and reside in a property in the same neighborhood. A borrower is unlikely to
purchase a new primary residence in the same neighborhood as his/her current residence, unless one of
the two will be an investment property, or he/she may be planning to let the old home go into
foreclosure after purchasing the new home at current market values.
In January of 2021, Wella and Kip agreed to purchase a home at a purchase price of $584,150. They
would like to hold on to as much of their savings as they can, but they have chosen to make a down
payment sufficient enough to qualify for a conforming loan. What is the minimum down payment they
can make to reach the conforming loan limit but still retain savings? - Answers The answer is $35,900.
The down payment in this scenario will be $35,900. This is just enough to keep them at the $548,250
conforming loan limit which was adjusted January 1, 2021. 584,150-548,250 = 35,900.
"The Nationwide Multistate Licensing System and Registry seeks to accomplish all of the following
objectives, except:
