2. The NMLS online system was built and is maintained by which of the following organizations:
ABA
FFIEC
FINRA
FTC

3. According to the SAFE Act, which of the following is the best definition of a non-traditional mortgage product:
An adjustable rate mortgage.
A mortgage with a term of less than 30 years.
An open-end mortgage.
Any mortgage other than 30-year fixed.

4. The SAFE Act refers to a residential mortgage loan as any loan primarily for the following purpose except:
Personal use.
Family use.
1-4 owner-occupied use.
Household use.

5. Which of the following would prevent an individual from being granted an MLO designation:
Felony assault conviction eight years ago.
Felony conviction for money laundering 15 years ago.
Loss of broker’s license with right to restricted salesperson’s license.
A pardoned felony conviction for fraud.

6. RESPA allows a lender to establish an escrow account cushion of which of the following:
1/3
1/6
1/4
1/8

7. According to RESPA, which of the following disclosures must be provided to the borrower within three business days of receipt of the completed loan application:
Good Faith Estimate of Settlement Costs.
Affiliated Business Arrangement Disclosure.
HUD-1 Settlement Statement.
Servicing Transfer Statement.

8. Settlement charges as expressed on the GFE must be available for how long after it has been issued?
Three days.
Three business days.
Five days.
Ten business days.

9. The new GFE requires that lender fees and mortgage broker fees be handled in which of the following ways:
As a lump sum origination charge.
That lender fees be itemized; mortgage broker fees be a lump sum.
That lender fees be a lump sum; mortgage broker fees be itemized.
That lender fees and mortgage broker fees be itemized.

10. Charges that can exceed the GFE amount by 10% include all of the following except:
Lender-required settlement services.
Transfer taxes.
Title services by provider identified by loan originator.
Government recording charges.

11. Tolerances are established for accuracy on the GFE. All of the following charges may not exceed the GFE amount except:
Origination charges.
Credit or charge for interest rate chosen.
Government recording charges.
Transfer taxes.

12. When is the MLO not required to check the box on the GFE indicating that the loan balance can increase?
When the monthly payment being made does not cover accrued interest.
When the loan balance is increasing only because escrow items are being paid through the loan balance.
When the loan is considered a negatively amortized loan.
When the MLO is convinced such information will cause the borrower to panic.

13. All of the following statements regarding the borrower’s Adjusted Origination Charges, Line A, Page 2 of the GFE are true, except:
Adjusted Origination Charges are determined by adding the numbers in Blocks 1 and 2.
Line A represents the total estimated settlement charges.
Line A is a subtotal.
The amount in Line A will be a negative number if there is a credit in Block 2 that exceeds the charge in Block 1.

14. If a loan does not require monthly payments as stated throughout the GFE and HUD-1 forms, but quarterly or biweekly, what is the proper solution?
Substitute the appropriate payment period on the forms.
Convert the actual periodic payments to monthly.
Make up an addendum and attach it to the GFE.
Divide quarterly payments by four.

15. Can items on the GFE be listed as P.O.C.?
No way.
Yes, if they are itemized.
Yes, without qualification.
Not without the underwriter’s endorsement.

16. A 10% tolerance applies to all of the following charges on the GFE, except:
Government recording charges.
Transfer taxes.
Pest inspection.
Owner’s title insurance.

17. If the loan amount is 95% LTV, what is the maximum percentage the seller can give to the buyer as closing costs?
3%
5%
6%
2%

18. What is a premium settlement charge?
The benefit from the borrower when calculating property tax.
The benefit from the borrower when calculating annual premium.
The benefit from the borrower when calculating mortgage insurance.
The benefit from the borrower when calculating hazard insurance.

19. Which party regulates the margin in an adjustable rate mortgage?
Feds.
Lender.
Investor.
Commissioner.

20. The buyer has a 3/27 loan. After three years it changes every year and includes principal and interest. By the end of the term, the buyer pays off the loan amount. This loan is best described as which of the following:
Fixed.
Adjustable.
Graduated payment.
Balloon payment.

21. A loan described as 360/180 is most likely which of the following:
Balloon payment.
ARM.
Fully amortized.
Negative amortization.

22. Fannie Mae guidelines for net adjustments to comps on a residential appraisal are which of the following:
10%
15%
20%
25%

23. According to TILA, the only fee that can be collected prior to providing mandated disclosures is which of the following:
Credit report fee.
Appraisal fee.
Application fee.
Loan origination fee.

24. If a consumer exercises his rights to rescind the loan, all of the following statements are true except:
The right exercised by one consumer is effective for all consumers.
The borrower(s) have no liability for the loan including finance charges.
The creditor must return any money it collected related to the loan within 30 calendar days.
The mortgage is void.

25. According to TILA, acceptable tolerances for the disclosure of finance charges are which of the following:
½ of one percent tolerance if the loan is with a new creditor and there is no new advance.
One percent tolerance if refinancing with a new creditor and there is no new advance and no consolidation of existing loans.
½ of one percent tolerance if the disclosed finance charge is understated by no more than 0.5% of the face amount of the note or $100 whichever is greater.
B and C.

26. HOEPA is also known as which of the following:
Regulation X.
Regulation C.
SB-36.
Section 32.

27. Which of the following is true regarding the APR Trigger of HOEPA:
It is triggered if the APR exceeds the rate of Treasury Securities by more than 3.5 % for a first loan.
It is triggered if the APR exceeds the rate of Treasury Securities by more than 10% for a first loan.
It is triggered if the APR exceeds the rate of Treasury Securities by more than 8% for a first loan.
It is triggered if the APR exceeds the rate of Treasury Securities by more than 8% for a second loan.

28. All of the following statements are true regarding negative amortization and the HOEPA loan except:
Negative amortization loans are prohibited with HOEPA loans.
Negative amortization is permitted to occur with HOEPA loans only if due to interest rate changes or payment schedule caps.
Negative amortization loans would cause an increase in the borrower’s total principal debt.
Negative amortization loans do not fully pay off the debt by the end of the term.

29. According to ECOA, creditors must notify applicants of a lending decision within what time frame?
Within 21 days of filing a completed application.
Within 30 days of filing a completed application.
Within 30 business days of filing a completed application.
Within 45 days of filing a completed application.

30. According to ECOA, borrowers have the right to request a copy of the appraisal report used in the decision-making process within what time frame?
30 days
60 days
90 days
120 days

31. According to ECOA, protected classifications include all of the following except:
Sex.
Age.
Disability
Race

Score =
Correct answers: