SAFE Mortgage Loan Originator Test
UPDATED ACTUAL Exam Questions and
CORRECT Answers
Prequalification - CORRECT ANSWER - an estimate of the loan amt. for which the buyer
can qualify based on his income/credit under the lenders standards
USDA ratio - CORRECT ANSWER - 29/41
FHA ratio - CORRECT ANSWER - 31/43
Asset based loan - CORRECT ANSWER - -loans based on borrowers equity
-bad when lenders fail to consider ability to repay
High Cost Loan - CORRECT ANSWER - Reg Z - Sec. 1026.32
-APR will exceed by more than 6.5% for first lien loans or by more than 8.5% for subordinate
-APOR - average prime offer rate
1. 5%
2. 6.5%
3. 8.5%
RESPA - Section 8 - CORRECT ANSWER - Nothing of value for referrals - No
kickbacks
Respa - Esign Act - CORRECT ANSWER - can use electronic signature with permission
of borrower
Gramm Leach Bliley - CORRECT ANSWER - -borrower notification must state who
company shares info with
, -consumers can opt-out of info sharing (send notice to consumer)
-Protects from phishing
-Safeguard Rules
Safeguard Rules - CORRECT ANSWER - -company and staff need to protect the
consumers identity
-lock up files
-part of GLB act
second mortgage - CORRECT ANSWER - -All money upfront
-no escrow as long as first mortgage is paying it
Subordination Clause - CORRECT ANSWER - A contract clause that puts a mortgage in
the first lien position over an earlier recorded mortgage
Denial Of License - CORRECT ANSWER - -any non-financial felony in the past 7 years
-financial felony ever
-financial misdemeanor (state decides)
-License has been revoked in another state
-default on a federal student loan
Income - CORRECT ANSWER - -Need to years history and 3 more years expected
income
-do not include sporadic overtime and bonuses
-likelihood of continued income
TILA - Respa Integrated Disclosure - CORRECT ANSWER - -TRID
-LE must be disclosed within 3 business days
-cannot require documentation from borrower without "intent to proceed"
UPDATED ACTUAL Exam Questions and
CORRECT Answers
Prequalification - CORRECT ANSWER - an estimate of the loan amt. for which the buyer
can qualify based on his income/credit under the lenders standards
USDA ratio - CORRECT ANSWER - 29/41
FHA ratio - CORRECT ANSWER - 31/43
Asset based loan - CORRECT ANSWER - -loans based on borrowers equity
-bad when lenders fail to consider ability to repay
High Cost Loan - CORRECT ANSWER - Reg Z - Sec. 1026.32
-APR will exceed by more than 6.5% for first lien loans or by more than 8.5% for subordinate
-APOR - average prime offer rate
1. 5%
2. 6.5%
3. 8.5%
RESPA - Section 8 - CORRECT ANSWER - Nothing of value for referrals - No
kickbacks
Respa - Esign Act - CORRECT ANSWER - can use electronic signature with permission
of borrower
Gramm Leach Bliley - CORRECT ANSWER - -borrower notification must state who
company shares info with
, -consumers can opt-out of info sharing (send notice to consumer)
-Protects from phishing
-Safeguard Rules
Safeguard Rules - CORRECT ANSWER - -company and staff need to protect the
consumers identity
-lock up files
-part of GLB act
second mortgage - CORRECT ANSWER - -All money upfront
-no escrow as long as first mortgage is paying it
Subordination Clause - CORRECT ANSWER - A contract clause that puts a mortgage in
the first lien position over an earlier recorded mortgage
Denial Of License - CORRECT ANSWER - -any non-financial felony in the past 7 years
-financial felony ever
-financial misdemeanor (state decides)
-License has been revoked in another state
-default on a federal student loan
Income - CORRECT ANSWER - -Need to years history and 3 more years expected
income
-do not include sporadic overtime and bonuses
-likelihood of continued income
TILA - Respa Integrated Disclosure - CORRECT ANSWER - -TRID
-LE must be disclosed within 3 business days
-cannot require documentation from borrower without "intent to proceed"
