MLO Practice Test Exam Question &
Answers ( Latest 2025)
An Approve/Eligible determination:
1. Is an indication that a property appraised for its sales price
2. Authorization to release funds in a refinance transaction
3. An automated loan approval from the Fannie Mae Du system
4. A recommendation that is received by the Freddie Mac loan
prospector automated underwriting system. - CORRECT ANSWERS
✔✔3. An automated loan approval from the Fannie Mae Du system..
this means that the borrower meets the credit requirements and all
other loan factors are acceptable. The LP recommendations are mostly
one word answers and the equivalent recommendation under LP would
be Accept.
If a lender agrees to subordinate a loan, what has occurred?
1. The borrower has a first and second and has refinanced the first.
2. The loan has been denied
3. The second has been paid off
4. The borrower is in foreclosure - CORRECT ANSWERS ✔✔1. The
borrower has a first and second and has refinanced the first...when the
borrowed refinanced a first and there is an existing second the second
becomes the first when the old loan is paid off. To avoid this from
happening the second position lender will subordinate and remain in
second position.
,MLO Practice Test Exam Question &
Answers ( Latest 2025)
Which of the following are you permitted to ask loan applicants under
the fair lending laws?
1. Their race
2. Their religion
3. If they plan to have additional children
4. Will they continue to work after they have children - CORRECT
ANSWERS ✔✔1. Their race, a HMDA requirement.
The National Credit Score Disclosure Form provides the following:
1. Statement that the credit score determines loan approval
2. Four reason codes for the credit score
3. A reason for the loan approval status
4. The reason for the loan denial - CORRECT ANSWERS ✔✔2. Four
reason codes for the credit score.
The income approach used in valuing property during an appraisal
considers the following:
1. The replacement cost of the property
2. The average meridian income levwels of the community
3. The fair market rental earnings of similar homes
4. The qualifying income potential borrowers - CORRECT ANSWERS
✔✔3. The fair market rental earnings of similar homes
,MLO Practice Test Exam Question &
Answers ( Latest 2025)
A mortgage broker decides to solicit business from a previous customer
who closed on a home purchase. Which action could result in a $16,000
fine?
1. Contacting the customer 17 months after the purchase transaction
closed
2. Verifying that the customer is not in the no-call-registry before
making a sales call 2 years after the purchase transaction closed
3. The client is listed on the company no-call list and the loan originator
calls the customer just shy of 18 months after the purchase transaction
closed.
4. The customer is on the no-call-register and the loan originator calls
14 months later - CORRECT ANSWERS ✔✔3. The client is listed on
the company no-call list and the loan originator calls the customer just
shy of 18 months after the purchase transaction closed. If the customer
has requested not to be called then it is a violation to call the customer.
Which of the following is not a factor in determining an interest rate?
1. Age
2. Time
3. Points
4. Margin - CORRECT ANSWERS ✔✔1. Age..age is a prohibited
basis under ECOA and can't be used to determine interest rates. Points
are discount fees that are charged to lower the rate, the longer the
, MLO Practice Test Exam Question &
Answers ( Latest 2025)
time generally higher the rate and margin is the lenders profit built into
the rate
Interest-only mortgages can be all of the following EXCEPT:
1. Can be fixed rate mortgages
2. Can be adjustable rate mortgages
3. Can be junior liens
4. Fully amortized loans - CORRECT ANSWERS ✔✔4. Fully
amortized loans..means that the amortization will pay out the loan.
With interest only, payments contribute to interest only and the
principal is not reduced.
Which of the following would not be a penalty for violating RESPA
section 8 relating to kickbacks?
1. Three times the value of the referral relating to the kickback and/or
unearned fees.
2. The attorneys fees for the affected person
3. The affected person would have the right to rescind the loan
transaction
4. A $10,000 fine and/or 1 year in prison for each violation. - CORRECT
ANSWERS ✔✔3. The affected person would have the right to
rescind the loan transaction..civil & criminal liability is provided for
violating the prohibition against kickbacks and unearned fees,
including: *Civil liability to the parties affected, equal to three times the
Answers ( Latest 2025)
An Approve/Eligible determination:
1. Is an indication that a property appraised for its sales price
2. Authorization to release funds in a refinance transaction
3. An automated loan approval from the Fannie Mae Du system
4. A recommendation that is received by the Freddie Mac loan
prospector automated underwriting system. - CORRECT ANSWERS
✔✔3. An automated loan approval from the Fannie Mae Du system..
this means that the borrower meets the credit requirements and all
other loan factors are acceptable. The LP recommendations are mostly
one word answers and the equivalent recommendation under LP would
be Accept.
If a lender agrees to subordinate a loan, what has occurred?
1. The borrower has a first and second and has refinanced the first.
2. The loan has been denied
3. The second has been paid off
4. The borrower is in foreclosure - CORRECT ANSWERS ✔✔1. The
borrower has a first and second and has refinanced the first...when the
borrowed refinanced a first and there is an existing second the second
becomes the first when the old loan is paid off. To avoid this from
happening the second position lender will subordinate and remain in
second position.
,MLO Practice Test Exam Question &
Answers ( Latest 2025)
Which of the following are you permitted to ask loan applicants under
the fair lending laws?
1. Their race
2. Their religion
3. If they plan to have additional children
4. Will they continue to work after they have children - CORRECT
ANSWERS ✔✔1. Their race, a HMDA requirement.
The National Credit Score Disclosure Form provides the following:
1. Statement that the credit score determines loan approval
2. Four reason codes for the credit score
3. A reason for the loan approval status
4. The reason for the loan denial - CORRECT ANSWERS ✔✔2. Four
reason codes for the credit score.
The income approach used in valuing property during an appraisal
considers the following:
1. The replacement cost of the property
2. The average meridian income levwels of the community
3. The fair market rental earnings of similar homes
4. The qualifying income potential borrowers - CORRECT ANSWERS
✔✔3. The fair market rental earnings of similar homes
,MLO Practice Test Exam Question &
Answers ( Latest 2025)
A mortgage broker decides to solicit business from a previous customer
who closed on a home purchase. Which action could result in a $16,000
fine?
1. Contacting the customer 17 months after the purchase transaction
closed
2. Verifying that the customer is not in the no-call-registry before
making a sales call 2 years after the purchase transaction closed
3. The client is listed on the company no-call list and the loan originator
calls the customer just shy of 18 months after the purchase transaction
closed.
4. The customer is on the no-call-register and the loan originator calls
14 months later - CORRECT ANSWERS ✔✔3. The client is listed on
the company no-call list and the loan originator calls the customer just
shy of 18 months after the purchase transaction closed. If the customer
has requested not to be called then it is a violation to call the customer.
Which of the following is not a factor in determining an interest rate?
1. Age
2. Time
3. Points
4. Margin - CORRECT ANSWERS ✔✔1. Age..age is a prohibited
basis under ECOA and can't be used to determine interest rates. Points
are discount fees that are charged to lower the rate, the longer the
, MLO Practice Test Exam Question &
Answers ( Latest 2025)
time generally higher the rate and margin is the lenders profit built into
the rate
Interest-only mortgages can be all of the following EXCEPT:
1. Can be fixed rate mortgages
2. Can be adjustable rate mortgages
3. Can be junior liens
4. Fully amortized loans - CORRECT ANSWERS ✔✔4. Fully
amortized loans..means that the amortization will pay out the loan.
With interest only, payments contribute to interest only and the
principal is not reduced.
Which of the following would not be a penalty for violating RESPA
section 8 relating to kickbacks?
1. Three times the value of the referral relating to the kickback and/or
unearned fees.
2. The attorneys fees for the affected person
3. The affected person would have the right to rescind the loan
transaction
4. A $10,000 fine and/or 1 year in prison for each violation. - CORRECT
ANSWERS ✔✔3. The affected person would have the right to
rescind the loan transaction..civil & criminal liability is provided for
violating the prohibition against kickbacks and unearned fees,
including: *Civil liability to the parties affected, equal to three times the
