CRCM Exam Flashcards UPDATED
ACTUAL Exam Questions and CORRECT
Answers
Regulation B—Applicant - CORRECT ANSWER - An applicant is any person who asks
for or receives credit from a creditor. The term includes any person who is or may become
contractually liable for an extension of credit, including a creditor required co-signer The term
also includes guarantors, sureties, endorsers, and similar parties
Fair Lending - Credit transaction - CORRECT ANSWER - For purposes of fair lending
rules, "credit transaction" covers every aspect of an applicant's dealings with the creditor, from
the application through pay-off or collection.
Regulation B—Age Discrimination - CORRECT ANSWER - There are special rules and
protections for elderly applicants—those age 62 or older. As long as applicants 62 or older are
treated at least as favorable as applicants younger than 62, age discrimination has not occurred
Regulation B— Marital Status - CORRECT ANSWER - Marital status can be considered
in only three ways. The applicant is Married Separated, or Unmarried (divorced, never-been-
married, or widowed)
Regulation B - Required Information to Request and Document - CORRECT ANSWER -
Monitoring information is required when the loan is primarily to purchase or refinance a
dwelling that is occupied or to be occupied by the applicant as their principal residence and the
loan will be secured by the dwelling. Additionally, a creditor that is a financial institution under
Regulation C (12 C.F.R. 1003.2(g)) may collect applicant ethnicity, race, and sex information on
loans secured by a dwelling in accordance with Appendix B of HMDA that are not exempt under
1003.3(c)(11) or 1003.3(c)(12).
Reg. B - Marital Status and Marital Income - CORRECT ANSWER - 1. When the
applicant applies for individual unsecured credit, you may not ask the applicant's marital status
unless the applicant resides in a community property state or is relying on property located in
such a state.
,2. Do not ask whether the applicant receives marital income (alimony, child support, separate
maintenance) unless and until they are notified that they need not reveal such income unless
relying on it to qualify for credit
Reg. B - Information Essential for Underwriting the Loan - CORRECT ANSWER - Some
information that could appear to be discriminatory is allowed because it is essential for
underwriting the loan application.
1. All liabilities, including accounts which the applicant holds or has held in another name
2. how many dependents he/she/they have
3. Applicant's immigration status—but only to determine the applicant's legal status in this
country and our legal remedies, should we need them These questions are allowed if we ask all
applicants for the same information and we do not seek or use the information in a
discriminatory way.
Reg. B - Age - CORRECT ANSWER - 1. We may consider age to favor an elderly
applicant (age 62 or older).
2. We may consider the applicant's youth—especially for the ability to enter into a legally
binding contract.
3. We may NOT use statistics to estimate the applicant's life expectancy—no matter how old
they are.
4. We may NOT base our credit decision on availability of credit life, health, accident, disability
or other credit-related insurance.
Reg B - Applications for Joint Credit - CORRECT ANSWER - When taking applications
from unmarried co-applicants, creditors must treat them the same way they treat married co-
applicants. When two people apply for credit, creditors consider the combined income, assets
and debts in the same way whether the applicants are married to each other or not
Reg B - Signature Rules, Secured Credit - CORRECT ANSWER - If the applicant
requests secured credit, we must not ask for or request the signature of the applicant's spouse
unless we need the signature to perfect our security interest. In this case, we may only require the
spouse's signature on instruments needed to perfect security.
,Reg. B - Timing Requirements - CORRECT ANSWER - The lender must send the notice
in the following timeframe:
1. Within 30 days of receiving a completed application or taking adverse action on an incomplete
application 2. Within 90 days of a counter-offer if the applicant did not accept it
Reg. B - Notice of Action Taken, Required Information - CORRECT ANSWER - The
following information must be included in the adverse action notice:
1. Creditor name, address, and contact information
2. The type of action taken on the application
3. The reasons for adverse action, or a statement that the applicant has the right to obtain reasons
4. Up to four principle factors or reasons from the consumer's application that caused the denial
5. A statement of the applicant's credit rights under the Equal Credit Opportunity Act
6. Name and address of the federal agency that administers compliance for the creditor
Reg. B - Special Rule for Business Loan Applications - CORRECT ANSWER - For
businesses with gross revenues of < $1,000,000, you may give the applicant a statement of action
taken orally—it need not be in writing. For businesses with gross revenues in excess of
$1,000,000 you may still give the applicant an oral notification, however, the notification must
be within a reasonable time of making the decision. If the applicant requests a written notice of
action within 60 days of the oral notification, you must provide a written notice of the action
taken.
Reg. B - Record Retention - CORRECT ANSWER - 1. The basic record retention rule is
25 months from the date you notify the applicant of your decision.
2. Records for credit applications from small businesses need only be retained for 12 months.
3. If the business has annual gross revenues in excess of $1 million, your records retention period
is 60 days after notification. However, if the applicant requests in writing the reasons for adverse
action or that records be retained, the retention period is 12 months.
4. Records for any type of credit must be retained beyond these limits if there is a court or
regulatory agency order to retain these records longer.
Reg. B, Are creditors required to ask for monitoring information if an applicant mails an
application to their financial institution? - CORRECT ANSWER - No. Creditors must ask
, for monitoring information (applicants' race, ethnicity, and gender for mortgage loan
applications) whenever they have personal contact with the customer. This includes applications
taken face-to-face and applications taken by telephone
Which two regulations require the creditor to obtain monitoring information on certain
mortgage-related credit applications? - CORRECT ANSWER - Regulation B and
Regulation C
For which two mortgage-related loans must the creditor collect the monitoring information under
Regulation B? - CORRECT ANSWER - 1. Loan for purchasing a principal residence
secured by that dwelling
2. Loan for refinancing a principal residence secured by that dwelling
Reg.B - Appraisal Requirements - CORRECT ANSWER - Creditors shall provide an
applicant a copy of all appraisals and other written valuations developed in connection with an
application for credit that is to be secured by a first lien on a dwelling.
Reg. B - Appraisal Requirements, Dwelling definition - CORRECT ANSWER - Dwelling
means a residential structure that contains 1-4 units whether or not that structure is attached to
real property. Dwelling includes, but is not limited to, a condominium or cooperative unit, and a
mobile or other manufactured home
Reg. B - Appraisal Disclosure Timing requirement - CORRECT ANSWER - A creditor
shall mail or deliver to an applicant, not later than the 3rd Business day after the creditor receives
an application for credit that is secured by a first lien on a dwelling, a written notice of the
applicant's right to receive a copy of all written appraisals developed in connection with the
application
Reg. B, Which three statements covering self-test privilege rules are correct? - CORRECT
ANSWER - 1. Privilege requires that the creditor perform appropriate corrective action
when the self-test identifies violations
2. The privilege is lost is anyone in the institution voluntarily discloses test information
3. The privilege is lost if the creditor fails to comply with the recording keeping requirements for
Regulation B
ACTUAL Exam Questions and CORRECT
Answers
Regulation B—Applicant - CORRECT ANSWER - An applicant is any person who asks
for or receives credit from a creditor. The term includes any person who is or may become
contractually liable for an extension of credit, including a creditor required co-signer The term
also includes guarantors, sureties, endorsers, and similar parties
Fair Lending - Credit transaction - CORRECT ANSWER - For purposes of fair lending
rules, "credit transaction" covers every aspect of an applicant's dealings with the creditor, from
the application through pay-off or collection.
Regulation B—Age Discrimination - CORRECT ANSWER - There are special rules and
protections for elderly applicants—those age 62 or older. As long as applicants 62 or older are
treated at least as favorable as applicants younger than 62, age discrimination has not occurred
Regulation B— Marital Status - CORRECT ANSWER - Marital status can be considered
in only three ways. The applicant is Married Separated, or Unmarried (divorced, never-been-
married, or widowed)
Regulation B - Required Information to Request and Document - CORRECT ANSWER -
Monitoring information is required when the loan is primarily to purchase or refinance a
dwelling that is occupied or to be occupied by the applicant as their principal residence and the
loan will be secured by the dwelling. Additionally, a creditor that is a financial institution under
Regulation C (12 C.F.R. 1003.2(g)) may collect applicant ethnicity, race, and sex information on
loans secured by a dwelling in accordance with Appendix B of HMDA that are not exempt under
1003.3(c)(11) or 1003.3(c)(12).
Reg. B - Marital Status and Marital Income - CORRECT ANSWER - 1. When the
applicant applies for individual unsecured credit, you may not ask the applicant's marital status
unless the applicant resides in a community property state or is relying on property located in
such a state.
,2. Do not ask whether the applicant receives marital income (alimony, child support, separate
maintenance) unless and until they are notified that they need not reveal such income unless
relying on it to qualify for credit
Reg. B - Information Essential for Underwriting the Loan - CORRECT ANSWER - Some
information that could appear to be discriminatory is allowed because it is essential for
underwriting the loan application.
1. All liabilities, including accounts which the applicant holds or has held in another name
2. how many dependents he/she/they have
3. Applicant's immigration status—but only to determine the applicant's legal status in this
country and our legal remedies, should we need them These questions are allowed if we ask all
applicants for the same information and we do not seek or use the information in a
discriminatory way.
Reg. B - Age - CORRECT ANSWER - 1. We may consider age to favor an elderly
applicant (age 62 or older).
2. We may consider the applicant's youth—especially for the ability to enter into a legally
binding contract.
3. We may NOT use statistics to estimate the applicant's life expectancy—no matter how old
they are.
4. We may NOT base our credit decision on availability of credit life, health, accident, disability
or other credit-related insurance.
Reg B - Applications for Joint Credit - CORRECT ANSWER - When taking applications
from unmarried co-applicants, creditors must treat them the same way they treat married co-
applicants. When two people apply for credit, creditors consider the combined income, assets
and debts in the same way whether the applicants are married to each other or not
Reg B - Signature Rules, Secured Credit - CORRECT ANSWER - If the applicant
requests secured credit, we must not ask for or request the signature of the applicant's spouse
unless we need the signature to perfect our security interest. In this case, we may only require the
spouse's signature on instruments needed to perfect security.
,Reg. B - Timing Requirements - CORRECT ANSWER - The lender must send the notice
in the following timeframe:
1. Within 30 days of receiving a completed application or taking adverse action on an incomplete
application 2. Within 90 days of a counter-offer if the applicant did not accept it
Reg. B - Notice of Action Taken, Required Information - CORRECT ANSWER - The
following information must be included in the adverse action notice:
1. Creditor name, address, and contact information
2. The type of action taken on the application
3. The reasons for adverse action, or a statement that the applicant has the right to obtain reasons
4. Up to four principle factors or reasons from the consumer's application that caused the denial
5. A statement of the applicant's credit rights under the Equal Credit Opportunity Act
6. Name and address of the federal agency that administers compliance for the creditor
Reg. B - Special Rule for Business Loan Applications - CORRECT ANSWER - For
businesses with gross revenues of < $1,000,000, you may give the applicant a statement of action
taken orally—it need not be in writing. For businesses with gross revenues in excess of
$1,000,000 you may still give the applicant an oral notification, however, the notification must
be within a reasonable time of making the decision. If the applicant requests a written notice of
action within 60 days of the oral notification, you must provide a written notice of the action
taken.
Reg. B - Record Retention - CORRECT ANSWER - 1. The basic record retention rule is
25 months from the date you notify the applicant of your decision.
2. Records for credit applications from small businesses need only be retained for 12 months.
3. If the business has annual gross revenues in excess of $1 million, your records retention period
is 60 days after notification. However, if the applicant requests in writing the reasons for adverse
action or that records be retained, the retention period is 12 months.
4. Records for any type of credit must be retained beyond these limits if there is a court or
regulatory agency order to retain these records longer.
Reg. B, Are creditors required to ask for monitoring information if an applicant mails an
application to their financial institution? - CORRECT ANSWER - No. Creditors must ask
, for monitoring information (applicants' race, ethnicity, and gender for mortgage loan
applications) whenever they have personal contact with the customer. This includes applications
taken face-to-face and applications taken by telephone
Which two regulations require the creditor to obtain monitoring information on certain
mortgage-related credit applications? - CORRECT ANSWER - Regulation B and
Regulation C
For which two mortgage-related loans must the creditor collect the monitoring information under
Regulation B? - CORRECT ANSWER - 1. Loan for purchasing a principal residence
secured by that dwelling
2. Loan for refinancing a principal residence secured by that dwelling
Reg.B - Appraisal Requirements - CORRECT ANSWER - Creditors shall provide an
applicant a copy of all appraisals and other written valuations developed in connection with an
application for credit that is to be secured by a first lien on a dwelling.
Reg. B - Appraisal Requirements, Dwelling definition - CORRECT ANSWER - Dwelling
means a residential structure that contains 1-4 units whether or not that structure is attached to
real property. Dwelling includes, but is not limited to, a condominium or cooperative unit, and a
mobile or other manufactured home
Reg. B - Appraisal Disclosure Timing requirement - CORRECT ANSWER - A creditor
shall mail or deliver to an applicant, not later than the 3rd Business day after the creditor receives
an application for credit that is secured by a first lien on a dwelling, a written notice of the
applicant's right to receive a copy of all written appraisals developed in connection with the
application
Reg. B, Which three statements covering self-test privilege rules are correct? - CORRECT
ANSWER - 1. Privilege requires that the creditor perform appropriate corrective action
when the self-test identifies violations
2. The privilege is lost is anyone in the institution voluntarily discloses test information
3. The privilege is lost if the creditor fails to comply with the recording keeping requirements for
Regulation B
