NMLS National Exam (Glossary) Questions and Answers Updated 2026

NMLS National Exam
(Glossary) Questions
and Answers Updated
2026
AbusiveBActB-
BAnswerActionBthatBmateriallyBinterferesBwithBaBconsumer'sBabilityBtoBunderstandBtheB
productBorBservice.



AccelerationBClauseB-
BAnswerClauseBthatBgivesBaBlenderBtheBrightBtoBdeclareBtheBentireBloanBbalanceBdueBi
mmediatelyBbecauseBofBborrowerBdefaultBorBforBviolationBofBotherBcontractBprovisions.



AccruedBExpensesB-
BAnswerItemsBonBaBsettlementBstatementBforBwhichBtheBcostBhasBbeenBincurred,BbutB
theBexpenseBhasBnotByetBbeenBpaid.



AcquisitionBCostB-
BAnswerTheBtotalBamountBneededBtoBpurchaseBproperty,BincludingBdownBpayment,Bloa
nBamount,BandBanyBallowableBbuyer-paidBclosingBcosts.



AdjustableBRateBMortgageB(ARM)B-
BAnswerABmortgageBthatBpermitsBtheBlenderBtoBperiodicallyBadjustBtheBinterestBrateBt
oBreflectBfluctuationsBinBtheBcostBofBmoney.



AdvertisementB-
BAnswerAnBadvertisementBisBaBcommercialBmessageBinBanyBmediumBthatBpromotes,Bdi
rectlyBorBindirectly,BaBcreditBtransaction.

,AlienationBClauseB-
BAnswerContractBclauseBthatBallowsBtheBlenderBtoBexerciseBcertainBrightsBuponBtheBsal
eBorBtransferBofBanBinterestBinBtheBproperty.BAlsoBcalledBDueBonBSaleBClause



Alt-ABLoanB-
BAnswerABtypeBofBloanBinBwhichBtheBriskBisBgreaterBthanBprime,BbutBlessBthanBsubpri
me.BTheBborrowerBmayBhaveBaBstrongBcreditBhistory,BbutBtheBmortgageBmayBhaveBele
mentsBthatBincreaseBrisk.



AmortizationB-
BAnswerReductionBofBtheBloanBbalanceBbyBpayingBback,BonBaBregularBbasis,BsomeBofBt
heBprincipalBowed.



ApplicationB-
BAnswerSubmissionBofBaBborrower'sBfinancialBinformationBinBanticipationBofBaBcreditBd
ecision.



AppraisalBManagementBCompanyB-BAnswerABbusinessBentityBthatB--
BforBaBmanagementBfeeB--
BadministersBaBnetworkBofBcertifiedBandBlicensedBappraisersBtoBfulfillBrealBestateBappra
isalBassignmentsBonBbehalfBofBmortgageBlendingBinstitutions.



AssetsB-BAnswerItemsBofBvalue.



AssumptionB-
BAnswerAnBactionBinBwhichBoneBpartyBagreesBtoBtakeBoverBpaymentsBofBanotherBpart
y'sBdebt,BwithBtermsBofBtheBnoteBstayingBunchanged.



AverageBPrimeBOfferBRateB(APOR)B-
BAnswerAnBannualBpercentageBrateBderivedBfromBaverageBinterestBrates,Bpoints,BandBo
therBloanBpricingBtermsBthatBareBcurrentlyBofferedBtoBconsumersBbyBaBrepresentativeB
sampleBofBlendersBforBmortgageBtransactionsBthatBhaveBlow-riskBpricingBcharacteristics.

, Bi-WeeklyBPaymentBPlanB-
BAnswerPlanBinBwhichBpaymentsBareBmadeBeveryBtwoBweeksBinsteadBofBonceBaBmont
h.



BonaBFideBOfferB-BAnswerAnBofferBmadeBinBgoodBfaithBwithBnoBelementBofBfraud.



BootB-BAnswerMoneyBandBlike-
kindBpropertyBexchangedBinBaBtransaction;BtermBfrequentlyBexpressedBconcerningBIRSB
SectionB1031Bexchanges.



Buydown,BPermanentB-
BAnswerTheBpaymentBofBpointsBbyBaBborrowerBtoBaBlenderBtoBreduceBtheBinterestBrat
eBandBloanBpaymentsBforBtheBentireBlifeBofBtheBloan.



Buydown,BTemporaryB-
BAnswerTheBpaymentBofBpointsBbyBaBborrowerBtoBaBlenderBtoBreduceBtheBinterestBrat
eBandBpaymentsBearlyBinBaBloan,BwithBinterestBrateBandBpaymentBrising.BPlansBcanBbe
BlevelBpayment,BwhereBtheBinterestBrateBisBreduced,BbutBtheBpaymentBisBconstantBthr
oughoutBtheBbuydownBperiod,BorBgraduatedBpayment,BwhereBpaymentBsubsidiesBinBth
eBearlyByearsBofBaBloanBkeepBpaymentsBlow,BbutBpaymentsBincreaseBeachByearBuntilBt
heyBareBsufficientBtoBfullyBamortizeBtheBloan.



ClosingB-
BAnswerTheBfinalBstageBinBaBrealBestateBtransactionBwhereBownershipBofBrealBproperty
BisBtransferredBfromBsellerBtoBbuyerBaccordingBtoBtheBtermsBandBconditionsBsetBforthB
inBaBsalesBcontractBorBescrowBagreement.



ClosingBCostsB-
BAnswerExpensesBincurredBinBtheBtransferBofBrealBestateBinBadditionBtoBtheBpurchaseB
priceB(e.g.,BtheBappraisalBfee,BtitleBinsuranceBpremiums,Bbroker'sBcommission,BtransferB
tax).