CFPB MCT 4
6. Which transaction meets the prepayment penalty coverage test and is therefore a
high-cost mortgage?
A. A $125,000 mortgage with a penalty of $1,500 flat fee if the loan is paid off before the
6 year maturity
B. A $30.000 mortgage with a penalty of $500 flat fee is the loan is paid off within 3
years of closing
C. A $250,000 mortgage with a penalty of $2,500 in waived closing costs ($500 third
party fees and $2,000 origination fees) if the plan is terminated less than 3 years after
account opening
D. A $25,000 mortgage with a penalty of $425 flat fee is the loan is paid off within 3
years of closing correct answers A. A $125,000 mortgage with a penalty of $1,500 flat
fee if the loan is paid off before the 6 year maturity
5. Under Regulation Z, the entity that buys or takes assignment of the loan must provide
the notice of sale or transfer to the borrower within how many days after acquiring the
loan.
A. 30 days
B. 60 days
C. 90 days
D. 180 days correct answers A. 30 days
20. Regulation D does not cover
a) Certificate of deposit accounts
b) Savings accounts
c) Non-personal time deposits
d) Money market deposit accounts (MMDAs)
e) All of the above
f) None of the above correct answers c) Non-personal time deposits
6. After receiving a payoff request, generally, how long does a servicer have to provide
the payoff statement?
A. 5 business days
B. 7 business days
C. 10 business days
D. 15 business days correct answers B. 7 business days
22. _____________assists government agencies in identifying possible dscriminatory
lending patterns and enforcing anti-discrimination laws.
A. Regulation B- Equal Credit Opportunity Act
B. Regulation BB - Community Reinvestment Act
C. The Fair Housing Act
, D. Regulation C- Home Mortgage Disclosure Act correct answers D. Regulation C-
Home Mortgage Disclosure Act
8. On a borrower requested cancellation, the principal balance of the loan must be
_____________percent of the original value in order for the servicer to cancel the PMI.
A. 82
B. 76
C. 78
D. 80 correct answers D. 80
6. What is the maximum number of mortgage loans a small servicer may service?
A. 500
B. 2,500
C. 5,000
D. 7,500 correct answers C. 5,000
7. Larry Smith has exceeded his transfer/ withdrawal limit 3 months in a row on his
savings deposit account, despite notifications from the institution each time. The
institution may take all of the following actions except which one?
a) Stop paying interest on the account
b) Close the account and move the funds to a demand deposit account
c) Remove the transfer and withdrawal feature on the account
d) Close the account and move the funds to a time deposit account correct answers d)
Close the account and move the funds to a time deposit account
10. What must a servicer do within 15 days if a consumer sends evidence of having
hazard insurance coverage in place that complies with the loan contract?
A. Cancel any force-placed insurance that it has purchased for the consumer and
refund any premiums or fees for the overlapping period.
B. Contact the insurance agent to verify the hazard insurance coverage.
C. Continue the force-placed insurance coverage at its own expense.
D. Send the consumer an acknowledgement notice. correct answers A. Cancel any
force-placed insurance that it has purchased for the consumer and refund any
premiums or fees for the overlapping period.
55. Sue had her debit card stolen on Monday. She notified her financial institution on
Friday. What is her maximum liability for $700 worth of unauthorized EFTs?
a) Only the amount of those transactions after Wednesday
b) $50
c) $500
d) $700 correct answers C. $500
54. A customer has the right to request the documents the institution relied on in making
the determination that an error did not occur.
a) True
b) False correct answers A. True
6. Which transaction meets the prepayment penalty coverage test and is therefore a
high-cost mortgage?
A. A $125,000 mortgage with a penalty of $1,500 flat fee if the loan is paid off before the
6 year maturity
B. A $30.000 mortgage with a penalty of $500 flat fee is the loan is paid off within 3
years of closing
C. A $250,000 mortgage with a penalty of $2,500 in waived closing costs ($500 third
party fees and $2,000 origination fees) if the plan is terminated less than 3 years after
account opening
D. A $25,000 mortgage with a penalty of $425 flat fee is the loan is paid off within 3
years of closing correct answers A. A $125,000 mortgage with a penalty of $1,500 flat
fee if the loan is paid off before the 6 year maturity
5. Under Regulation Z, the entity that buys or takes assignment of the loan must provide
the notice of sale or transfer to the borrower within how many days after acquiring the
loan.
A. 30 days
B. 60 days
C. 90 days
D. 180 days correct answers A. 30 days
20. Regulation D does not cover
a) Certificate of deposit accounts
b) Savings accounts
c) Non-personal time deposits
d) Money market deposit accounts (MMDAs)
e) All of the above
f) None of the above correct answers c) Non-personal time deposits
6. After receiving a payoff request, generally, how long does a servicer have to provide
the payoff statement?
A. 5 business days
B. 7 business days
C. 10 business days
D. 15 business days correct answers B. 7 business days
22. _____________assists government agencies in identifying possible dscriminatory
lending patterns and enforcing anti-discrimination laws.
A. Regulation B- Equal Credit Opportunity Act
B. Regulation BB - Community Reinvestment Act
C. The Fair Housing Act
, D. Regulation C- Home Mortgage Disclosure Act correct answers D. Regulation C-
Home Mortgage Disclosure Act
8. On a borrower requested cancellation, the principal balance of the loan must be
_____________percent of the original value in order for the servicer to cancel the PMI.
A. 82
B. 76
C. 78
D. 80 correct answers D. 80
6. What is the maximum number of mortgage loans a small servicer may service?
A. 500
B. 2,500
C. 5,000
D. 7,500 correct answers C. 5,000
7. Larry Smith has exceeded his transfer/ withdrawal limit 3 months in a row on his
savings deposit account, despite notifications from the institution each time. The
institution may take all of the following actions except which one?
a) Stop paying interest on the account
b) Close the account and move the funds to a demand deposit account
c) Remove the transfer and withdrawal feature on the account
d) Close the account and move the funds to a time deposit account correct answers d)
Close the account and move the funds to a time deposit account
10. What must a servicer do within 15 days if a consumer sends evidence of having
hazard insurance coverage in place that complies with the loan contract?
A. Cancel any force-placed insurance that it has purchased for the consumer and
refund any premiums or fees for the overlapping period.
B. Contact the insurance agent to verify the hazard insurance coverage.
C. Continue the force-placed insurance coverage at its own expense.
D. Send the consumer an acknowledgement notice. correct answers A. Cancel any
force-placed insurance that it has purchased for the consumer and refund any
premiums or fees for the overlapping period.
55. Sue had her debit card stolen on Monday. She notified her financial institution on
Friday. What is her maximum liability for $700 worth of unauthorized EFTs?
a) Only the amount of those transactions after Wednesday
b) $50
c) $500
d) $700 correct answers C. $500
54. A customer has the right to request the documents the institution relied on in making
the determination that an error did not occur.
a) True
b) False correct answers A. True
