NMLS SAFE DETAILED EXAM questions with 100% updated answers!!

Primary Mortgage Market - correct answers️️Where credit institutions originate loans C. The maximum the rate can increase over the life of the loan - correct answers️️When an ARM has rate caps of 5/2/6, the 6 refers to what? A. The maximum rate increase at the initial adjustment B. The start rate for the loan C. The maximum the rate can increase over the life of the loan D. The rate maximum the rate can decrease over the life of the loan B. The borrower qualified at the buydown rate - correct answers️️When utilizing a temporary buydown to lower the interest rate on a FHA loan, which of the following are correct A. The borrower qualified at the note rate B. The borrower qualified at the buydown rate C. The rate cannot be more than 2% below the note rate D. Seller or builder can pay the discount points to buydown the rate A. Age - correct answers️️All of the following are violations of the Fair Housing Act EXCEPT A. Age B. National Origin C. Disability D.Religion Encrumbrance - correct answers️️Claim against property held by one who is not the legal owner Trigger Term - correct answers️️Advertised term that requires additional disclosures Advertising Disclosure - correct answers️️An advertisement must be presented "clearly and conspicuously" to keep from being deceptive, unfair, or otherwise violate a Commission rule Waving Right of Rescission - correct answers️️Extenuating circumstances such as "bona fide personal financial emergency Right of Rescission - correct answers️️Right that borrowers have to cancel a loan or line of credit with a lender within three days of closing Business Day - correct answers️️When creditors office is open to the public, a calendar working day except Sunday or a federal holiday Application - correct answers️️Financial information used for purposes of obtaining an extension of credit Disclosure - correct answers️️The act of making new information known FTC Federal Trade Commission - correct answers️️Mission is to promote consumer protection and eliminate and prevent anticompetitive business practices CFPB Consumer Financial Protection Bureau - correct answers️️Regulatory agency charged with overseeing financial products and services offered to consumers TILA Truth in Lending Act - correct answers️️Enacted 1968 promotes the informed use of consumer credit by requiring disclosures about terms and costs and standardizes the manner in which costs with borrowing are calculated and disclosed Per Diem Interest - correct answers️️Interest charged on a loan for one or more days Annual Interest Rate Formula - correct answers️️Principal (X) Interest Rate = Annual Interest Rate Interest Only Mortgage - correct answers️️Mortgage where the mortgagor is only required to pay off the interest that arises from the principal that is borrowed for a set period Permanent Buydown - correct answers️️Borrower chooses to pay additional "discount points" to buy down the interest rate for the life of the mortgage note 2/1 Buydown - correct answers️️Used on fixed rate loans over two years Set of two initial temporary-start interest rates that increase in stair-step fashion until a permanent interest rate is reached Discount Point - correct answers️️A form of pre-paid interest which effectively increases the yield on the loan above the amount of the stated interest rate CLTV Combined Loan to Value - correct answers️️An amount in addition to the Loan to Value, which simply represents the first position mortgage or loan as a percentage of the property's value LTV Loan to Value - correct answers️️Ratio of a loan to the value of an asset purchased PITI - correct answers️️Principal, Interest, Taxes, Insurance Refers to the components of a mortgage payment DIF - correct answers️️Housing to Debt Ratio that measures an individual's ability to manage monthly payment and repay debts Forbearance - correct answers️️Agreement between the lender and the borrower to delay foreclosure Loan Modification - correct answers️️A permanent restructuring of the mortgage where one or more of the terms of a borrower's loan are changed to provide a more affordable payment Foreclosure - correct answers️️Legal process to collect debt on mortgaged property Satisfaction of Mortgage Letter - correct answers️️Document generated and signed by a mortgage lender, acknowledging that the borrower has paid off the mortgage loan in full and the mortgage is not a lien on the property Subordination Agreement - correct answers️️When two mortgages are on a property, this specifies which mortgage takes precedence Payoff Statement - correct answers️️Provides homeowner proof the mortgage is paid off Constructive Note - correct answers️️Legal presumption that anything recorded in a public record can be known by anyone Actual Note - correct answers️️Direct knowledge that one has of the property Inquiry Note - correct answers️️Information that should compel a reasonable person to make further inquiries about some aspect of the property Title Record - correct answers️️Serves as a central repository of information about a parcel of land SRP Service Release Premiums - correct answers️️Payment received by lender after selling a loan Based on market value GNMA Government National Mortgage Association - correct answers️️Created in 1968, goal to expand affordable housing under HUD FNMA Federal National Mortgage Association - correct answers️️Created 1968 works with Fannie Mae to increase affordable lending FHA Federal Housing Administration - correct answers️️Insures banks real estate loans and charges borrowers a small premium HELOC Home Equity Line of Credit - correct answers️️A loan in which the lender agrees to lend a maximum amount within an agreed period and is also an open-ended mortgage transaction that is secured HECM Home Equity Conversion Mortgage - correct answers️️A FHA insured reverse mortgage that allows the conversion of equity in a home to cash Balloon Mortgage - correct answers️️A mortgage in which a large portion of the borrowed principal is repaid in a single payment at the end of the loan period and does not amortize ARM Interest Rate Adjustment - correct answers️️Margin + Interset = Rate COFI Cost of Fund Index - correct answers️️Regional average of interest expenses incurred by financial institutions which in turn is used as a base for calculating variable rate loans ARM Adjustable Rate Mortgage - correct answers️️Loan that is lower than fixed rate in beginning Loan payment changes over time Adjustable caps that vary Used to obtain a higher loan amount Fixed Rate - correct answers️️Interest rate that remains the same over the life of the loan Non-Conforming Loan - correct answers️️Does not meet Freddie Mac or Fannie Mae guidelines Conforming Loan - correct answers️️Conforms to terms and conditions set by government Conventional Loan - correct answers️️Not guaranteed or insured by the government but can still follow federal guidelines Acceleration Clause - correct answers️️Accelerated loan repayment if property is in default Exculpatory Clause - correct answers️️Relieves one party form liability due to actions of another party Defeasance Clause - correct answers️️Creditor can obtain title without foreclosure process Late Payement Penalty - correct answers️️When fees are attached to late payment Pre-Payment Penalty - correct answers️️Fixed sum added to loan if loan is paid off early Contract of Deed - correct answers️️Complete financing and sales contract agreed upon by seller and seller with no note attached