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NMLS SAFE EXAM 2 WITH CORRECT AND
VERIFIED ANSWERS
When is it allowable for an originator to provide a real estate agent
with a $50 gift card in exchange for a referral?
A-It is a violation of RESPA for the originator to provide the card
B-If the gift card has no dollar amount listed on it
C-As long as the originator provides equal gift cards to each service
provider on the loan
D-If the real estate agent's commission was no more than 25% more
valuable than the card - answer-A-It is a violation of RESPA for the
originator to provide the card
Mishandling borrowers' funds or improperly managing their funds is a
practice prohibited by:
a) FNMA
b) GLB
c) RESPA
d) TILA - answer-c) RESPA
All of the following are true of FHA fixed-rate loans, except:
, Page 2 of 54
a) they are available in 15 and 30 year terms
b) the borrower is only required to carry MIP until the LTV reaches
78%
c) the borrower just make at least 3.5% investment
d) they require MIP upfront on all loans - answer-b) only required to
carry MIP until the LTV reaches 78% is FALSE
An appraiser uses any one of three appraisal approaches to determine
the value of a propriety. They are:
A-sales comparison, market comparison, and subject comparison
B-sales comparison or market, cost, and income
C-sales, cost, and comparable
D-market comparison, cost comparison, and investment approach -
answer-B-sales comparison or market, cost, and income
Which of the following best describes the legal consequences of
providing an inflated description of income on a loan application?
A-It is not illegal if the applicant inflates his or her income to secure
approval for the loan but fully intends to repay the obligation
B-It is a violation of multiple federal lending laws and constitutes
fraud
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C-It is not a violation of criminal laws, and any penalties imposed are
civil, not criminal
D-It is not an illegal act, but may impact the consumer's credit score -
answer-B-It is a violation of multiple federal lending laws and
constitutes fraud
All of the following are responsibilities of the closing agent, except:
A-Verify identity and notarize documents
B-Coordinate the closing process
C-Explain the risks and benefits of the ARM product in which the
client is closing
D-Verify that all parties have copies of forms and disclosures required
for settlement - answer-C-Explain the risks and benefits of the ARM
product in which the client is closing
Who is responsible for ensuring that the Closing Disclosure is
delivered to the consumer?
The CFPB
The loan processor
The consumer
The creditor - answer-The creditor
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A mortgage broker structures a higher-priced loan with two points in
borrower credit because the borrower has limited cash to close, and
suggests the borrower use the premium generated to subsidize the
closing costs. After consideration, the borrower agrees and moves
forward. This is:
Illegal and unethical
Legal and ethical
Legal and unethical
Illegal and ethical - answer-Legal and ethical
In an ARM, margin is determined by:
A-The underwriter, and it represents the percentage of error allowable
for debt-to-income ratio
B-The lender, and it represents the lender's operating costs and profit
margin
C-The broker, and it is the amount of profit split between the broker
and lender
D-The lender, and it represents the amount of commission paid to the
broker - answer-The lender, and it represents the lender's operating
costs and profit margin
Which law restricts the sharing of information given when a
consumer applies for a mortgage loan?
NMLS SAFE EXAM 2 WITH CORRECT AND
VERIFIED ANSWERS
When is it allowable for an originator to provide a real estate agent
with a $50 gift card in exchange for a referral?
A-It is a violation of RESPA for the originator to provide the card
B-If the gift card has no dollar amount listed on it
C-As long as the originator provides equal gift cards to each service
provider on the loan
D-If the real estate agent's commission was no more than 25% more
valuable than the card - answer-A-It is a violation of RESPA for the
originator to provide the card
Mishandling borrowers' funds or improperly managing their funds is a
practice prohibited by:
a) FNMA
b) GLB
c) RESPA
d) TILA - answer-c) RESPA
All of the following are true of FHA fixed-rate loans, except:
, Page 2 of 54
a) they are available in 15 and 30 year terms
b) the borrower is only required to carry MIP until the LTV reaches
78%
c) the borrower just make at least 3.5% investment
d) they require MIP upfront on all loans - answer-b) only required to
carry MIP until the LTV reaches 78% is FALSE
An appraiser uses any one of three appraisal approaches to determine
the value of a propriety. They are:
A-sales comparison, market comparison, and subject comparison
B-sales comparison or market, cost, and income
C-sales, cost, and comparable
D-market comparison, cost comparison, and investment approach -
answer-B-sales comparison or market, cost, and income
Which of the following best describes the legal consequences of
providing an inflated description of income on a loan application?
A-It is not illegal if the applicant inflates his or her income to secure
approval for the loan but fully intends to repay the obligation
B-It is a violation of multiple federal lending laws and constitutes
fraud
, Page 3 of 54
C-It is not a violation of criminal laws, and any penalties imposed are
civil, not criminal
D-It is not an illegal act, but may impact the consumer's credit score -
answer-B-It is a violation of multiple federal lending laws and
constitutes fraud
All of the following are responsibilities of the closing agent, except:
A-Verify identity and notarize documents
B-Coordinate the closing process
C-Explain the risks and benefits of the ARM product in which the
client is closing
D-Verify that all parties have copies of forms and disclosures required
for settlement - answer-C-Explain the risks and benefits of the ARM
product in which the client is closing
Who is responsible for ensuring that the Closing Disclosure is
delivered to the consumer?
The CFPB
The loan processor
The consumer
The creditor - answer-The creditor
, Page 4 of 54
A mortgage broker structures a higher-priced loan with two points in
borrower credit because the borrower has limited cash to close, and
suggests the borrower use the premium generated to subsidize the
closing costs. After consideration, the borrower agrees and moves
forward. This is:
Illegal and unethical
Legal and ethical
Legal and unethical
Illegal and ethical - answer-Legal and ethical
In an ARM, margin is determined by:
A-The underwriter, and it represents the percentage of error allowable
for debt-to-income ratio
B-The lender, and it represents the lender's operating costs and profit
margin
C-The broker, and it is the amount of profit split between the broker
and lender
D-The lender, and it represents the amount of commission paid to the
broker - answer-The lender, and it represents the lender's operating
costs and profit margin
Which law restricts the sharing of information given when a
consumer applies for a mortgage loan?
