NMLS MLO Exam 2026 | Mortgage Loan Originator Practice
Questions & Verified Answers
What must a borrower do to avoid having late payments
reported to a credit bureau? - Precise Answer ✔✔Pay within 30
days of due date
Max penalty if a borrower is required to use a specific title
company or settlement agent? - Precise Answer ✔✔3 times the
fee
What should not be over-weighted in an analysis of borrower
repayment capacity? - Precise Answer ✔✔Credit scores
Max prepayment penalty on residential mortgages in the first
year of the loan - Precise Answer ✔✔3%
What must condominium associations do with respect to
property insurance? - Precise Answer ✔✔Keep a "blanket"
policy that protects the entire structure
If a lender is planning on referring a borrower to a title company
that the lender has ownership in, when must the AFBA must be
provided to the borrower? - Precise Answer ✔✔Before the
referral to the title company is made
Website to obtain copy of your credit report that the credit
bureaus are required to provide once per year at no charge -
Precise Answer ✔✔annualcreditreport.com
,2/3/6 caps - Precise Answer ✔✔ARM initial adjustment max is
2%, subsequent adjustment period max is 3%, and lifetime cap
of 6%
What does FHLB stand for and what do they provide? - Precise
Answer ✔✔Federal Home Loan Bank, and they provide
advances to financial institutions for residential mortgage loans
According to the Dodd-Frank Act, how much risk must be
retained by the securitizer for a loan that does not meet QRM
guidelines? - Precise Answer ✔✔5%
On a purchase transaction, what document contains the purchase
price for a property? - Precise Answer ✔✔Sales Contract
After a loan has been closed and funded, the creditor notices a
tolerance violation with a fee between the LE and CD. How long
does the creditor have to reimburse the borrower for the
overcharge before being considered in violation of the TRID
rule? - Precise Answer ✔✔60 days after closing
According to the Dodd-Frank Act, how much risk must be
retained by the securitizer for a loan that does not meet QRM
guidelines? - Precise Answer ✔✔5%
Overt Discrimination - Precise Answer ✔✔Refusing service to
anyone of a certain race, ethnicity, etc.
Under ECOA can you ask how many children a borrower has? -
Precise Answer ✔✔No
, What document specifies that a property is being used as
security in the event of nonpayment of a debt? - Precise Answer
✔✔Mortgage
On the LE, which piece of data tells applicants how much they
will be paying in interest over the life of the loan as a percentage
of the loan? - Precise Answer ✔✔TIP (Total Interest
Percentage)
COFI comes from what region in the country? - Precise Answer
✔✔The 11th Federal Home Loan Bank (Arizona, California,
and Nevada)
What disclosure is required to be provided to the applicant
within 3 days of application under reg x? - Precise Answer
✔✔Mortgage Loan Servicing Disclosure
Verification of cash used in a closing is documented by: -
Precise Answer ✔✔last 2-3 months bank statements
The finance charge is the total cost of: - Precise Answer ✔✔the
loan in dollars, including points and mortgage insurance
What IRS forms would you requrest from a borrower who is
40% shareholder in a C-Corporation? - Precise Answer
✔✔Form 1120
Impersonating someone else in an attempt to obtain their
personal financial information is called: - Precise Answer
Questions & Verified Answers
What must a borrower do to avoid having late payments
reported to a credit bureau? - Precise Answer ✔✔Pay within 30
days of due date
Max penalty if a borrower is required to use a specific title
company or settlement agent? - Precise Answer ✔✔3 times the
fee
What should not be over-weighted in an analysis of borrower
repayment capacity? - Precise Answer ✔✔Credit scores
Max prepayment penalty on residential mortgages in the first
year of the loan - Precise Answer ✔✔3%
What must condominium associations do with respect to
property insurance? - Precise Answer ✔✔Keep a "blanket"
policy that protects the entire structure
If a lender is planning on referring a borrower to a title company
that the lender has ownership in, when must the AFBA must be
provided to the borrower? - Precise Answer ✔✔Before the
referral to the title company is made
Website to obtain copy of your credit report that the credit
bureaus are required to provide once per year at no charge -
Precise Answer ✔✔annualcreditreport.com
,2/3/6 caps - Precise Answer ✔✔ARM initial adjustment max is
2%, subsequent adjustment period max is 3%, and lifetime cap
of 6%
What does FHLB stand for and what do they provide? - Precise
Answer ✔✔Federal Home Loan Bank, and they provide
advances to financial institutions for residential mortgage loans
According to the Dodd-Frank Act, how much risk must be
retained by the securitizer for a loan that does not meet QRM
guidelines? - Precise Answer ✔✔5%
On a purchase transaction, what document contains the purchase
price for a property? - Precise Answer ✔✔Sales Contract
After a loan has been closed and funded, the creditor notices a
tolerance violation with a fee between the LE and CD. How long
does the creditor have to reimburse the borrower for the
overcharge before being considered in violation of the TRID
rule? - Precise Answer ✔✔60 days after closing
According to the Dodd-Frank Act, how much risk must be
retained by the securitizer for a loan that does not meet QRM
guidelines? - Precise Answer ✔✔5%
Overt Discrimination - Precise Answer ✔✔Refusing service to
anyone of a certain race, ethnicity, etc.
Under ECOA can you ask how many children a borrower has? -
Precise Answer ✔✔No
, What document specifies that a property is being used as
security in the event of nonpayment of a debt? - Precise Answer
✔✔Mortgage
On the LE, which piece of data tells applicants how much they
will be paying in interest over the life of the loan as a percentage
of the loan? - Precise Answer ✔✔TIP (Total Interest
Percentage)
COFI comes from what region in the country? - Precise Answer
✔✔The 11th Federal Home Loan Bank (Arizona, California,
and Nevada)
What disclosure is required to be provided to the applicant
within 3 days of application under reg x? - Precise Answer
✔✔Mortgage Loan Servicing Disclosure
Verification of cash used in a closing is documented by: -
Precise Answer ✔✔last 2-3 months bank statements
The finance charge is the total cost of: - Precise Answer ✔✔the
loan in dollars, including points and mortgage insurance
What IRS forms would you requrest from a borrower who is
40% shareholder in a C-Corporation? - Precise Answer
✔✔Form 1120
Impersonating someone else in an attempt to obtain their
personal financial information is called: - Precise Answer
