NMLS MLO PRACTICE TEST – MORTGAGE LOAN ORIGINATOR (MLO) LICENSING EXAM
PRACTICE QUESTIONS AND ANSWER EXPLANATIONS A+ VERIFIED 2026
1. A Good Faith Estimate is not issued until a complete b. Consumer's assets
application is received from a consumer. Which an-
swer is NOT part of the list of information that qual-
ifies as a received application?
a. Consumer's social security number
b. Consumer's assets
c. Address of the property
d. The mortgage loan amount sought
2. Which type of loan is exempt from Real Estate Settle- a. A loan to finance a com-
ment Procedures Act (RESPA)? mercial warehouse
a. A loan to finance a commercial warehouse
b. A reverse mortgage
c. A home equity line of credit
d. A mortgage to purchase a single family home
3. The initial escrow statement includes all of the follow- b. the amount that is
ing EXCEPT collected for homeowners
a. the amount of the monthly mortgage payment association (HOA) dues
b. the amount that is collected for homeowners asso-
ciation dues
c. the portion of the monthly payment going into the
escrow account
d. the amount of reserves or cushion as determined
by the loan servicer
4. When is an adverse action notice required? c. when a counterotter is
a. when an application is withdrawn extended, and the otter is
b. when a counteroffer is extended, and the offer is rejected (an adverse ac-
accepted tion is a negative action
c. when a counteroffer is extended, and the offer is reported to a consumer
rejected
, NMLS MLO PRACTICE TEST – MORTGAGE LOAN ORIGINATOR (MLO) LICENSING EXAM
PRACTICE QUESTIONS AND ANSWER EXPLANATIONS A+ VERIFIED 2026
d. when there is a change in the terms of the mort- regarding the denial of
gage the credit application
5. Which factor can be considered when evaluation a a. Immigration Status (it
loan application? can attect their ability to
a. Immigration Status repay the loan)
b. National Origin
c. Pregnancy
d. Marital Status
6. Which income source cannot be considered in a loan a. Educational Military
review? Benefits (benefits don't
a. Educational Military Benefits continue after they've fin-
b. Part-time Income ished school)
c. Alimony and Child Support
d. Annuity Income
7. What type of property does a right of recission apply c. A Principal Residence
to?
a. A second home
b. A nonowner-occupied duplex
c. A principal residence
d. A nonowner-occupied condominium
8. All of the following are an example of a finance charge d. Title Insurance
EXCEPT
a. Interest
b. Points
c. A Loan Processing Fee
d. Title Insurance
9. To avoid steering a customer to a loan product that c. The loan with the short-
may give higher compensation to a mortgage loan est term
, NMLS MLO PRACTICE TEST – MORTGAGE LOAN ORIGINATOR (MLO) LICENSING EXAM
PRACTICE QUESTIONS AND ANSWER EXPLANATIONS A+ VERIFIED 2026
originator, an MLO must provide multiple loan options
for a borrower to review. These loan options must
include all of the following EXCEPT
a. The loan with the lowest interest rate
b. The loan with the lowest amount of origination or
discount points
c. The loan with the shortest term
d. The loan with the lowest interest rate that does not
have a prepayment penalty, interest-only payments,
a negative amortization, or a balloon payment in the
first 7 years of the loan
10. All of the following are required to be covered by b. Reverse Mortgages
HOEPA EXCEPT
a. Refinances
b. Reverse mortgages
c. Closed-end Home Equity Loans
d. Purchase Money Mortgages
11. What is NOT an example of a "change of circum- d. A change in the borrow-
stance"? er's monthly income
a. The need for flood insurance
b. A change in the loan amount after the Good Faith
Estimate has been issued
c. A disater
d. A change in the borrower's monthly income
12. Once a complete application has been received, the b. 3 business days after
loan estimate must be delivered or mailed to the bor- the receipt of the applica-
rower tion
a. 3 calendar days after receipt of the application
b. 3 business days after receipt of the application
, NMLS MLO PRACTICE TEST – MORTGAGE LOAN ORIGINATOR (MLO) LICENSING EXAM
PRACTICE QUESTIONS AND ANSWER EXPLANATIONS A+ VERIFIED 2026
c. 7 business days after receipt of the application
d. 7 calendar days after receipt of the application
13. The Truth and Lending Act ensures all of the following a. It gives guidance to a
EXCEPT lender on whether they
a. It gives guidance to a lender on whether they should grant a loan to a
should grant a loan to a borrower borrower
b. It requires all lenders to have a uniform set of dis-
closures
c. It provides borrowers with the right to rescind
d. It provides minimum standards for most residential
loans secured by a dwelling
14. When is a lender required to send a consumer a copy b. 3 days before a loan
of their appraisal? closes
a. 7 days before a loan closes
b. 3 days before a loan closes
c. 3 days after the report is completed
d. After a consumer has paid for the appraisal
15. Which piece of information may NOT be omitted by an d. Social Security Number
applicant on a mortgage application?
a. Race
b. Sex
c. Ethnicity
d. Social Security Number
16. A fraud alert can be triggered by each of the following d. When a consumer's
EXCEPT credit report shows that he
a. When a consumer's credit report shows that he or or she is under investiga-
she is a victim of fraud tion for committing fraud
b. When a consumer's credit report reflects that he
or she has filed a criminal complaint pertaining to
PRACTICE QUESTIONS AND ANSWER EXPLANATIONS A+ VERIFIED 2026
1. A Good Faith Estimate is not issued until a complete b. Consumer's assets
application is received from a consumer. Which an-
swer is NOT part of the list of information that qual-
ifies as a received application?
a. Consumer's social security number
b. Consumer's assets
c. Address of the property
d. The mortgage loan amount sought
2. Which type of loan is exempt from Real Estate Settle- a. A loan to finance a com-
ment Procedures Act (RESPA)? mercial warehouse
a. A loan to finance a commercial warehouse
b. A reverse mortgage
c. A home equity line of credit
d. A mortgage to purchase a single family home
3. The initial escrow statement includes all of the follow- b. the amount that is
ing EXCEPT collected for homeowners
a. the amount of the monthly mortgage payment association (HOA) dues
b. the amount that is collected for homeowners asso-
ciation dues
c. the portion of the monthly payment going into the
escrow account
d. the amount of reserves or cushion as determined
by the loan servicer
4. When is an adverse action notice required? c. when a counterotter is
a. when an application is withdrawn extended, and the otter is
b. when a counteroffer is extended, and the offer is rejected (an adverse ac-
accepted tion is a negative action
c. when a counteroffer is extended, and the offer is reported to a consumer
rejected
, NMLS MLO PRACTICE TEST – MORTGAGE LOAN ORIGINATOR (MLO) LICENSING EXAM
PRACTICE QUESTIONS AND ANSWER EXPLANATIONS A+ VERIFIED 2026
d. when there is a change in the terms of the mort- regarding the denial of
gage the credit application
5. Which factor can be considered when evaluation a a. Immigration Status (it
loan application? can attect their ability to
a. Immigration Status repay the loan)
b. National Origin
c. Pregnancy
d. Marital Status
6. Which income source cannot be considered in a loan a. Educational Military
review? Benefits (benefits don't
a. Educational Military Benefits continue after they've fin-
b. Part-time Income ished school)
c. Alimony and Child Support
d. Annuity Income
7. What type of property does a right of recission apply c. A Principal Residence
to?
a. A second home
b. A nonowner-occupied duplex
c. A principal residence
d. A nonowner-occupied condominium
8. All of the following are an example of a finance charge d. Title Insurance
EXCEPT
a. Interest
b. Points
c. A Loan Processing Fee
d. Title Insurance
9. To avoid steering a customer to a loan product that c. The loan with the short-
may give higher compensation to a mortgage loan est term
, NMLS MLO PRACTICE TEST – MORTGAGE LOAN ORIGINATOR (MLO) LICENSING EXAM
PRACTICE QUESTIONS AND ANSWER EXPLANATIONS A+ VERIFIED 2026
originator, an MLO must provide multiple loan options
for a borrower to review. These loan options must
include all of the following EXCEPT
a. The loan with the lowest interest rate
b. The loan with the lowest amount of origination or
discount points
c. The loan with the shortest term
d. The loan with the lowest interest rate that does not
have a prepayment penalty, interest-only payments,
a negative amortization, or a balloon payment in the
first 7 years of the loan
10. All of the following are required to be covered by b. Reverse Mortgages
HOEPA EXCEPT
a. Refinances
b. Reverse mortgages
c. Closed-end Home Equity Loans
d. Purchase Money Mortgages
11. What is NOT an example of a "change of circum- d. A change in the borrow-
stance"? er's monthly income
a. The need for flood insurance
b. A change in the loan amount after the Good Faith
Estimate has been issued
c. A disater
d. A change in the borrower's monthly income
12. Once a complete application has been received, the b. 3 business days after
loan estimate must be delivered or mailed to the bor- the receipt of the applica-
rower tion
a. 3 calendar days after receipt of the application
b. 3 business days after receipt of the application
, NMLS MLO PRACTICE TEST – MORTGAGE LOAN ORIGINATOR (MLO) LICENSING EXAM
PRACTICE QUESTIONS AND ANSWER EXPLANATIONS A+ VERIFIED 2026
c. 7 business days after receipt of the application
d. 7 calendar days after receipt of the application
13. The Truth and Lending Act ensures all of the following a. It gives guidance to a
EXCEPT lender on whether they
a. It gives guidance to a lender on whether they should grant a loan to a
should grant a loan to a borrower borrower
b. It requires all lenders to have a uniform set of dis-
closures
c. It provides borrowers with the right to rescind
d. It provides minimum standards for most residential
loans secured by a dwelling
14. When is a lender required to send a consumer a copy b. 3 days before a loan
of their appraisal? closes
a. 7 days before a loan closes
b. 3 days before a loan closes
c. 3 days after the report is completed
d. After a consumer has paid for the appraisal
15. Which piece of information may NOT be omitted by an d. Social Security Number
applicant on a mortgage application?
a. Race
b. Sex
c. Ethnicity
d. Social Security Number
16. A fraud alert can be triggered by each of the following d. When a consumer's
EXCEPT credit report shows that he
a. When a consumer's credit report shows that he or or she is under investiga-
she is a victim of fraud tion for committing fraud
b. When a consumer's credit report reflects that he
or she has filed a criminal complaint pertaining to
