MLO SAFE NMLS safe test practice (Latest
2026/ 2027 Update) questions and
answers 100% Correct [Grade A]
Which Federal Law allows the borrower to challenge the value stated on an appraisal?
- Correct answer ECOA
Per the Federal Fair Housing Act, the phrase that must be included in a broadcast
advertisement is _________________________. - Correct answer Equal Housing Lender
Per RESPA, a loan application must include ____________________.
a. a property address
b. an estimate of value
c. Both a and b
d. Neither a or b - Correct answer b. Both A and B
While generally prohibited, a higher priced loan can include prepayment penalties for
up to __________ years. - Correct answer 2 Years
,A borrower earns $10,000 per month and has installment debt and revolving charge
payments of $1,400 per month. Per FHA guidelines this borrowers maximum allowable
housing expense is _______________. - Correct answer $2,900. $10,000 X 43% = $4,300 -
$1,400 = $2,900
FHA ratios 31/43
Use the lesser of the front/back end
Front=$10,000 X 31%=$3,100
The amount of money that the VA will guarantee is called the _______________________. -
Correct answer Entitlement
Sheryl and Marty jointly own their primary residence which they are refinancing. Marty
is given the only copy of the notice of the right to rescind. How long do they have to
rescind the transaction? - Correct answer 3 Years. All co-owners should receive a
rescission notice. Per TILA (the truth in lending act) the rescission period is expanded
to three years if there has not been complete or proper disclosure of the right to
rescind.
,Per the Federal Fair Housing Act what must be displayed in every branch where
mortgage loans are made? - Correct answer The "Equal Housing Opportunity" poster.
Who are the three largest lenders/investors in the secondary market? - Correct
answer FNMA, GNMA, and FHLMC. Fannie Mae, Ginnie Mae and Freddie Mac
The Real Estate Settlement Procedures Act (RESPA) is also known as Regulation
_______________. - Correct answer Regulation X
The ________________ is the purchase price of the property plus the allowable buyer paid
closing costs. - Correct answer Acquisition Cost
Per Reg Z in 2014, a loan is considered higher priced if the APR exceeds the APOR by
___________% for a 1st mortgage, ___________% for a jumbo 1st lien or ________% for a
subordinate lien. - Correct answer 5%, 5%, 5%, all five percent.
Money paid by a lender to a Mortgage Broker for adding value to the loan is called
__________________. - Correct answer YSP, Yield Spread Premium
, A Borrower is buying a home for $150,000 and makes a down payment of $10,000. He
agrees to pay 2 discount points which equal _________________. - Correct answer $2,800.
$140,000 X .02 = $2,800
The purpose of the Fair Credit Reporting Act from the perspective of both the 1.
consumer and the 2. lender includes 1. ______________ and 2. __________________. -
Correct answer 1. Allows the consumers to dispute credit information. 2. Compels
lenders to disclose the source of derogatory credit information if a loan is denied.
The SAFE act is an acronym for __________________________________. - Correct answer
The Secure and Fair Enforcement for the the mortgage licensing act of 2008.
Who enforces Regulation Z? - Correct answer The CFPB, Consumer Financial
Protection Bureau
A _______________ allows qualified homeowners age 62 or older to convert equity in
their home to a monthly cash flow or line of credit. - Correct answer Reverse
2026/ 2027 Update) questions and
answers 100% Correct [Grade A]
Which Federal Law allows the borrower to challenge the value stated on an appraisal?
- Correct answer ECOA
Per the Federal Fair Housing Act, the phrase that must be included in a broadcast
advertisement is _________________________. - Correct answer Equal Housing Lender
Per RESPA, a loan application must include ____________________.
a. a property address
b. an estimate of value
c. Both a and b
d. Neither a or b - Correct answer b. Both A and B
While generally prohibited, a higher priced loan can include prepayment penalties for
up to __________ years. - Correct answer 2 Years
,A borrower earns $10,000 per month and has installment debt and revolving charge
payments of $1,400 per month. Per FHA guidelines this borrowers maximum allowable
housing expense is _______________. - Correct answer $2,900. $10,000 X 43% = $4,300 -
$1,400 = $2,900
FHA ratios 31/43
Use the lesser of the front/back end
Front=$10,000 X 31%=$3,100
The amount of money that the VA will guarantee is called the _______________________. -
Correct answer Entitlement
Sheryl and Marty jointly own their primary residence which they are refinancing. Marty
is given the only copy of the notice of the right to rescind. How long do they have to
rescind the transaction? - Correct answer 3 Years. All co-owners should receive a
rescission notice. Per TILA (the truth in lending act) the rescission period is expanded
to three years if there has not been complete or proper disclosure of the right to
rescind.
,Per the Federal Fair Housing Act what must be displayed in every branch where
mortgage loans are made? - Correct answer The "Equal Housing Opportunity" poster.
Who are the three largest lenders/investors in the secondary market? - Correct
answer FNMA, GNMA, and FHLMC. Fannie Mae, Ginnie Mae and Freddie Mac
The Real Estate Settlement Procedures Act (RESPA) is also known as Regulation
_______________. - Correct answer Regulation X
The ________________ is the purchase price of the property plus the allowable buyer paid
closing costs. - Correct answer Acquisition Cost
Per Reg Z in 2014, a loan is considered higher priced if the APR exceeds the APOR by
___________% for a 1st mortgage, ___________% for a jumbo 1st lien or ________% for a
subordinate lien. - Correct answer 5%, 5%, 5%, all five percent.
Money paid by a lender to a Mortgage Broker for adding value to the loan is called
__________________. - Correct answer YSP, Yield Spread Premium
, A Borrower is buying a home for $150,000 and makes a down payment of $10,000. He
agrees to pay 2 discount points which equal _________________. - Correct answer $2,800.
$140,000 X .02 = $2,800
The purpose of the Fair Credit Reporting Act from the perspective of both the 1.
consumer and the 2. lender includes 1. ______________ and 2. __________________. -
Correct answer 1. Allows the consumers to dispute credit information. 2. Compels
lenders to disclose the source of derogatory credit information if a loan is denied.
The SAFE act is an acronym for __________________________________. - Correct answer
The Secure and Fair Enforcement for the the mortgage licensing act of 2008.
Who enforces Regulation Z? - Correct answer The CFPB, Consumer Financial
Protection Bureau
A _______________ allows qualified homeowners age 62 or older to convert equity in
their home to a monthly cash flow or line of credit. - Correct answer Reverse
