©FYNDLAY 2024/2025 ALL RIGHTS RESERVED.
The SAFE Mortgage Loan Originator
National Exam Study Guide practice Exam 1
Questions And Answers. Verified And
Updated
1. A discount point is BEST described as a charge the borrower pays to: - Answer✔A. A lender
to decrease the interest rate on the mortgage loan
2. A buyer has made an earnest money payment of $5,000. The buyer pays an additional $2,000
in option money to be credited at closing on a property with a sale price of $160,000. If the
required down payment is 20%, how much additional money will the buyer need to provide
toward the down payment at closing? - Answer✔D. $25,000
3. If an applicant works 40 hours every week and is paid $13.52 per hour, what is the applicant's
monthly income? - Answer✔B. $2,343.47
4. The requirement for private mortgage insurance is generally discontinued when the loan-to-
value ratio falls below: - Answer✔C. 80 %
5. Which of the following documents itemizes all settlement costs including lender charges? -
Answer✔B. HUD-1/Closing Disclosure
6. According to the Truth-in-Lending Act (TILA), the term "refinance" applies to: - Answer✔D.
The satisfaction of an existing obligation and its replacement by a new obligation
7. What does a loan originator use to determine the estimated value of a property based on an
analytical comparison of similar property sales? - Answer✔A. An appraisal
8. Which of the following methods of disclosure does NOT meet the requirements of the Equal
Credit Opportunity Act (ECOA)? - Answer✔C. Telephone
9. The term "20 basis points" expressed as a percentage is: - Answer✔B. 0.20%
10. According to the Truth-in-Lending Act (TILA), which of the following fees is EXCLUDED
from the calculation of the annual percentage rate? - Answer✔A. Hazard insurance
11. FHA loans are: - Answer✔B. 100% insured
12. The late fee for a conventional loan is: - Answer✔C. 5 % of principal and interest
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, ©FYNDLAY 2024/2025 ALL RIGHTS RESERVED.
13. A funding fee is required for a: - Answer✔B. VA loan
14. A Mortgage Insurance Premium is required on: - Answer✔A. FHA loans
15. The mortgagee is the: - Answer✔B. Lender
16. The borrower does NOT sign which document: - Answer✔A. Deed
17. Which document is usually NOT recorded? - Answer✔B. Note
18. A mortgagee title insurance policy is NOT : - Answer✔C. Optional
19. Which parties sign the deed? - Answer✔B. Grantor and two witnesses
20. When the mortgagor and mortgagee title insurance policies are issued at the same time, this
is known as: - Answer✔A. Simultaneous issue
21. A shrubbery hedge is one example of an: - Answer✔D. Acceptable title impediment
22. A loan on personal property only is known as: - Answer✔B. Chattel mortgage
23. Which of the following is NOT a characteristic of a Tenants in Common form of ownership:
- Answer✔C. Right of survivorship
24. PITI payments do NOT include which of the following: - Answer✔B. Funding Fee
25. Who does Fannie Mae hold responsible for the quality of an appraisal? - Answer✔D. Lender
26. Which law is known as Regulation B? - Answer✔C. Equal Credit Opportunity Act
27. Which law prohibits discrimination by lenders? - Answer✔C. Equal Credit Opportunity Act
28. A property sold for $200,000 and was appraised at $180,000. The borrower received a loan
for $150,000. What is the loan-to-value? - Answer✔B. 83.3 %
29. How many days does a lender have to send an adverse action notice? - Answer✔C. 30
30. The GFE/Loan Estimate must be mailed or given to the borrower within how many days
after receiving the signed application? - Answer✔A. 3 business days
31. The enforcement of a lien is known as a: - Answer✔B. Foreclosure
32. What minimum percentage of ownership in a related service requires a conflict of interest
disclosure? - Answer✔B. 10 %
33 What minimum percentage of ownership qualifies an individual as self-employed? A. 5 % -
Answer✔C. 25 %
34. A salaried employee may have to produce which of the following documents to obtain a
loan? - Answer✔B. 2 years W2s
2|Page
The SAFE Mortgage Loan Originator
National Exam Study Guide practice Exam 1
Questions And Answers. Verified And
Updated
1. A discount point is BEST described as a charge the borrower pays to: - Answer✔A. A lender
to decrease the interest rate on the mortgage loan
2. A buyer has made an earnest money payment of $5,000. The buyer pays an additional $2,000
in option money to be credited at closing on a property with a sale price of $160,000. If the
required down payment is 20%, how much additional money will the buyer need to provide
toward the down payment at closing? - Answer✔D. $25,000
3. If an applicant works 40 hours every week and is paid $13.52 per hour, what is the applicant's
monthly income? - Answer✔B. $2,343.47
4. The requirement for private mortgage insurance is generally discontinued when the loan-to-
value ratio falls below: - Answer✔C. 80 %
5. Which of the following documents itemizes all settlement costs including lender charges? -
Answer✔B. HUD-1/Closing Disclosure
6. According to the Truth-in-Lending Act (TILA), the term "refinance" applies to: - Answer✔D.
The satisfaction of an existing obligation and its replacement by a new obligation
7. What does a loan originator use to determine the estimated value of a property based on an
analytical comparison of similar property sales? - Answer✔A. An appraisal
8. Which of the following methods of disclosure does NOT meet the requirements of the Equal
Credit Opportunity Act (ECOA)? - Answer✔C. Telephone
9. The term "20 basis points" expressed as a percentage is: - Answer✔B. 0.20%
10. According to the Truth-in-Lending Act (TILA), which of the following fees is EXCLUDED
from the calculation of the annual percentage rate? - Answer✔A. Hazard insurance
11. FHA loans are: - Answer✔B. 100% insured
12. The late fee for a conventional loan is: - Answer✔C. 5 % of principal and interest
1|Page
, ©FYNDLAY 2024/2025 ALL RIGHTS RESERVED.
13. A funding fee is required for a: - Answer✔B. VA loan
14. A Mortgage Insurance Premium is required on: - Answer✔A. FHA loans
15. The mortgagee is the: - Answer✔B. Lender
16. The borrower does NOT sign which document: - Answer✔A. Deed
17. Which document is usually NOT recorded? - Answer✔B. Note
18. A mortgagee title insurance policy is NOT : - Answer✔C. Optional
19. Which parties sign the deed? - Answer✔B. Grantor and two witnesses
20. When the mortgagor and mortgagee title insurance policies are issued at the same time, this
is known as: - Answer✔A. Simultaneous issue
21. A shrubbery hedge is one example of an: - Answer✔D. Acceptable title impediment
22. A loan on personal property only is known as: - Answer✔B. Chattel mortgage
23. Which of the following is NOT a characteristic of a Tenants in Common form of ownership:
- Answer✔C. Right of survivorship
24. PITI payments do NOT include which of the following: - Answer✔B. Funding Fee
25. Who does Fannie Mae hold responsible for the quality of an appraisal? - Answer✔D. Lender
26. Which law is known as Regulation B? - Answer✔C. Equal Credit Opportunity Act
27. Which law prohibits discrimination by lenders? - Answer✔C. Equal Credit Opportunity Act
28. A property sold for $200,000 and was appraised at $180,000. The borrower received a loan
for $150,000. What is the loan-to-value? - Answer✔B. 83.3 %
29. How many days does a lender have to send an adverse action notice? - Answer✔C. 30
30. The GFE/Loan Estimate must be mailed or given to the borrower within how many days
after receiving the signed application? - Answer✔A. 3 business days
31. The enforcement of a lien is known as a: - Answer✔B. Foreclosure
32. What minimum percentage of ownership in a related service requires a conflict of interest
disclosure? - Answer✔B. 10 %
33 What minimum percentage of ownership qualifies an individual as self-employed? A. 5 % -
Answer✔C. 25 %
34. A salaried employee may have to produce which of the following documents to obtain a
loan? - Answer✔B. 2 years W2s
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