Course: Lesson: National Mortgage Loan Originator Review Crammer (ml) Federal Mortgage-Related Laws 1. According to HMDA, what must be forwarded to the regulator by March 1 of each year? A. Adverse Action Notices B. Do Not Call List C. Loan/Application Register D. Red Flags Policy 2. HMDA stands for A. Home Mortgage Disclosure Act. B. Home Mortgage Discovery Act. C. Homeowners Mortgage Discovery Act. D. Household Mortgage Disclosure Act. 3. The Truth in Lending Act (TILA) was enacted to A. delay closings. B. enable banks to sell mortgages more easily. C. prevent abuses in consumer credit cost disclosures. D. put procedures in place for handling settlement. 4. How many business days after a mortgage loan application does a loan officer have to mail disclosures to the borrower? A. four B. three C. two D. one 5. The duty to investigate a consumer dispute falls to the information furnishers. According to the FCRA, how many days do they usually have to respond to the consumer from the receipt of notice of a dispute? A. 30
B. 60 C. 90 Course: Lesson: D. 120 National Mortgage Loan Originator Review Crammer (ml) Federal Mortgage-Related Laws 6. According to the ECOA, an adverse action notice is NOT required to include the A. appraiser's name. B. credit bureau. C. federal regulator. D. lender. 7. After a loan closing, funds are disbursed. When are the funds disbursed for an owneroccupied, residential refinance? A. after the three-day rescission period B. at the time of the loan closing C. five days after the closing D. right before the loan closing 8. TILA requires all of this financial information to be reflected on the TIL Statement EXCEPT the A. amount financed. B. finance charges. C. note rate. D. total of payments. 9. A company required to update their internal do not call list every A. 30 days B. 3 months C. year D. 18 months
10. According to RESPA, a lender making a loan with escrow included is able to collect a maximum cushion of how many months at closing? A. none B. one C. two Course: Lesson: D. three National Mortgage Loan Originator Review Crammer (ml) Federal Mortgage-Related Laws 11. Which federal law requires a lender to verify that the customer is able to repay the loan? A. Community Reinvestment Act B. Home Mortgage Disclosure Act C. Home Ownership and Equity Protection Act D. Homeowners Protection Act 12. HOEPA is also known as A. Section 30. B. Section 32. C. Section 33. D. Section 34. 13. The SAFE Act A. mandates the disclosures required at the time that a loan closes. B. requires loan originators to have at least 20 hours of prelicensing education. C. requires lenders to disclose the timing under which PMI can be cancelled. D. requires lenders to order appraisals through an appraisal management company. 14. Which is a disclosure that RESPA requires creditors to give to customers at the time of the mortgage loan closing? A. GFE B. HUD-1
C. Mortgage Servicing Disclosure Statement D. Settlement Costs and You Booklet 15. The SAFE Act A. allows financial institutions to obtain, verify, and record information that identifies each person who opens an account. B. establishes minimum standards for licensing and registering mortgage loan originators. C. prevents abuses in consumer credit cost disclosures. Course: Lesson: D. prohibits kickbacks in a federally-related mortgage loan transaction. National Mortgage Loan Originator Review Crammer (ml) Federal Mortgage-Related Laws 16. Which federal law is NOT primarly intended to address issues of privacy and identity protection relating to credit? A. ECOA B. FACT Act C. FCRA D. Gramm-Leach-Bliley 17. Under RESPA, what is the maximum fine that can be imposed for each instance of a kickback? A. $5,000 B. $7,000 C. $10,000 D. $15,000 18. How long prior to closing does RESPA require that the HUD-1 Settlement Statement be provided to the borrower, if requested? A. 6 hours B. 12 hours C. 24 hours D. 48 hours
19. Which federal law limits the length of time that adverse collection information may appear in a consumer's credit report? A. Regulation B B. Regulation C C. Regulation V D. Regulation Z 20. Ann closed a loan last week with ABC Mortgage Company. Her name is on the National Do Not Call Registry and on ABC s internal do not call list. ABC A. can call Ann for up to 3 months because they have an established business relationship. B. can call Ann for up to 18 months from the transaction date. C. cannot call Ann because she is on ABC s internal list. Course: Lesson: D. cannot call Ann because she is on the National Do Not Call Registry. National Mortgage Loan Originator Review Crammer (ml) Federal Mortgage-Related Laws 21. Which item is NOT included in the calculation that determines the annual percentage rate? A. broker's origination fee B. lender's discount points C. mortgage insurance premium D. title insurance premium 22. HMDA requires lenders to request what information from applicants for home mortgage loans? A. applicant's race B. number of children the applicant has C. religion of the applicant D. source of the down payment money 23. How many hours of annual continuing education are required by the SAFE Act for loan originators?
A. 5 B. 8 C. 12 D. 20 24. A loan's APR must be disclosed to the consumer on the A. GFE. B. initial escrow statement. C. Loan/Application Register (LAR). D. TIL Statement. 25. What law requires that borrowers be shown how much they are going to pay for credit in dollars and percentages? A. CRA B. ECOA C. GFE Course: Lesson: D. TILA National Mortgage Loan Originator Review Crammer (ml) Federal Mortgage-Related Laws 26. The only mortgage that Lucille s lender would give her is a high-cost loan that defers interest payments for the first two years, anticipating that her salary will increase enough to change the payment schedule. A loan that results in negative amortization is illegal under what law? A. FACTA B. HOEPA C. RESPA D. TILA 27. What government agency oversees TILA? A. Congress B. Federal Reserve Board
C. Federal Trade Commission D. HUD 28. According to RESPA, an Affiliated Business Arrangement (AfBA) disclosure must be provided A. at the time of application, even if there are no AfBAs. B. at or prior to the time a referral is made, if there is an AfBA. C. within three days of settlement, even if there are no AfBAs. D. Never; RESPA does not require this disclosure. 29. RESPA requires the use of the HUD-1 for A. any commercial or residential property. B. any residential property. C. one- to four-family residences. D. single-family dwellings only. 30. How many days from the day of application does the creditor have to deliver the mortgage servicing disclosure, GFE, and the Settlement Costs and You booklet? A. one B. two C. three Course: Lesson: D. five National Mortgage Loan Originator Review Crammer (ml) Federal Mortgage-Related Laws 31. While it is unlawful to consider race when underwriting a loan, what federal legislation requires that this information be included on the loan application? A. Equal Credit Opportunity Act B. Fair Credit Reporting Act C. Home Mortgage Disclosure Act D. Truth in Lending Act
32. HOEPA is an addendum of A. Regulation B. B. Regulation C. C. Regulation X. D. Regulation Z. 33. Which law ensures lenders use an annual percentage rate (APR) so that the borrowers have the information they need to make informed comparisons? A. Equal Credit Opportunity Act B. Fair Housing Act C. Regulation X D. Regulation Z 34. A borrower has a three-year right of rescission if the true APR on a fixed rate loan deviates from the final TIL by more than A. 1/8%. B. 1/4%. C. 1/2%. D. 6/8%. 35. HMDA is also known as Regulation A. B. B. C. C. X. D. Z. Course: National Mortgage Loan Originator Review Crammer (ml) Lesson: Federal Mortgage-Related Laws
You have not successfully completed the exam Score Required: 75 Exam Score: 23 Attempt: 42 of Unlimited X 1. According to HMDA, what must be forwarded to the regulator by March 1 of each year? 2. HMDA stands for A. Adverse Action Notices C. Loan/Application Register The Home Mortgage Disclosure Act requires that all data collected the prior year on the Loan/Application Register be forwarded to the regulator by March 1. [R010] A. Home Mortgage Disclosure Act. A. Home Mortgage Disclosure Act. X 3. The Truth in Lending Act (TILA) was enacted to HMDA stands for the Home Mortgage Disclosure Act. [R029] A. delay closings. C. prevent abuses in consumer credit cost disclosures. TILA requires lenders to disclose consumer credit costs in a uniform manner to promote informed use of consumer credit, enabling them to compare credit costs and shop around for the best credit terms. [R073] X 4. How many business days after a mortgage loan application does a loan officer have to mail disclosures to the borrower? A. four B. three The required disclosures, including the Good Faith Estimate, Truth in Lending Statement, and Mortgage Servicing Disclosure Statement, must be delivered to the borrower within three business days, according to Reg X and Reg Z. [R033] 5. The duty to investigate a consumer dispute falls to the information furnishers. According to the FCRA, how many days do they usually have to respond to the consumer from the receipt of notice of a dispute? A. 30 A. 30 The information furnisher should complete their investigation within 30 days and either correct the credit report or explain
why there is no error. [R061] 6. According to the ECOA, an adverse action notice is NOT required to include the A. appraiser's name. A. appraiser's name. The appraiser is not required to be listed, even if value of condition was the reason for the loan denial. The lender, credit agency, and federal regulator are all required on a statement of credit denial. [R012] 7. After a loan closing, funds are disbursed. When are the funds disbursed for an owner-occupied, residential refinance? A. after the three-day rescission period A. after the three-day rescission period Owner-occupied residential refinance loans have a three-day rescission. The funds are disbursed on the fourth day. [R021] X 8. TILA requires all of this financial information to be reflected on the TIL Statement EXCEPT the A. amount financed. C. note rate. The note rate (the rate used to amortize the loan) is not required to be listed on the TIL Statement, however the APR is required. [R074] 9. A company required to update their internal do not call list every A. 30 days A. 30 days An internal do not call list must be updated every 30 days. [R036] X 10. According to RESPA, a lender making a loan with escrow included is able to collect a maximum cushion of how many months at closing? A. none C. two The lender is entitled to a two-month cushion of the payment being due, allowing for a tax or insurance increase prior to the payment being due and disbursed. [R001] X 11. Which federal law requires a lender to verify that the customer is able to repay the loan? A. Community Reinvestment Act C. Home Ownership and Equity Protection Act
X 12. HOEPA is also known as A. Section 30. B. Section 32. X 13. The SAFE Act The Home Ownership and Equity Protection Act establishes disclosure requirements, prohibits deceptive and unfair practices in lending, and it requires verification of a borrower s ability to repay a high-cost loan. [R104] HOEPA is Section 32 of the TILA addendum. [R030] A. mandates the disclosures required at the time that a loan closes. B. requires loan originators to have at least 20 hours of prelicensing education. The SAFE Act requires 20 hours of prelicensing education for new loan originators. Individual states may impose additional educational requirements. The other statements are unrelated to the SAFE Act. [R120] X 14. Which is a disclosure that RESPA requires creditors to give to customers at the time of the mortgage loan closing? A. GFE X 15. The SAFE Act B. HUD-1 The HUD-1 is the document prepared at the time of closing that breaks down the final settlement charges. The other three are given within three days of the application. [R110] A. allows financial institutions to obtain, verify, and record information that identifies each person who opens an account. B. establishes minimum standards for licensing and registering mortgage loan originators. The SAFE Act is designed to enhance consumer protection and reduce fraud by requiring states to establish minimum standards for the licensing and registration of state-licensed mortgage loan originators. [R070] 16. Which federal law is NOT primarly intended to address issues of privacy and identity protection relating to credit? A. ECOA A. ECOA The Equal Credit Opportunity Act is primarily an antidiscrimination law. The other laws deal directly with credit reporting and protection of consumer financial records and identity. [R102]
X 17. Under RESPA, what is the maximum fine that can be imposed for each instance of a kickback? A. $5,000 C. $10,000 The fine per kickback can be as much as $10,000 per incident. [R079] X 18. How long prior to closing does RESPA require that the HUD-1 Settlement Statement be provided to the borrower, if requested? A. 6 hours C. 24 hours RESPA requires that the borrower have the right to inspect the HUD-1 24 hours prior to closing, if requested. [R032] X 19. Which federal law limits the length of time that adverse collection information may appear in a consumer's credit report? A. Regulation B C. Regulation V The Fair Credit Reporting Act, or Regulation V, limits the number of years that negative credit information can appear in a credit report. [R103] X 20. Ann closed a loan last week with ABC Mortgage Company. Her name is on the National Do Not Call Registry and on ABC s internal do not call list. ABC A. can call Ann for up to 3 months because they have an established business relationship. C. cannot call Ann because she is on ABC s internal list. A customer, even one with whom a company has an established business relationship, is off limits if she is on the company s required internal do not call list. [R022] X 21. Which item is NOT included in the calculation that determines the annual percentage rate? A. broker's origination fee D. title insurance premium The title insurance premium is not included in calculating the APR since it is paid to the title underwriter to insure the title. [R114] 22. HMDA requires lenders to request what information from applicants for home mortgage loans? A. applicant's race A. applicant's race
The Home Mortgage Disclosure Act requires that the applicant be asked their race or national origin for monitoring purposes. [R028] X 23. How many hours of annual continuing education are required by the SAFE Act for loan originators? A. 5 B. 8 The SAFE Act mandates that loan originators take at least eight hours of continuing education every year. [R035] X 24. A loan's APR must be disclosed to the consumer on the A. GFE. D. TIL Statement. The Truth in Lending Statement (TIL) discloses the total cost of financing, including the annual percentage rate (APR). [R004] X 25. What law requires that borrowers be shown how much they are going to pay for credit in dollars and percentages? A. CRA D. TILA The Truth in Lending Act or Regulation Z requires that borrowers be shown how much they are going to pay for credit in dollars and percentages and that lenders use an APR (annual percentage rate). [R087] X 26. The only mortgage that Lucille s lender would give her is a high-cost loan that defers interest payments for the first two years, anticipating that her salary will increase enough to change the payment schedule. A loan that results in negative amortization is illegal under what law? A. FACTA B. HOEPA X 27. What government agency oversees TILA? Negative amortization results when the loan balance increases because of deferred interest payments. These types of loans are not permitted under the Home Ownership and Equity Protection Act (HOEPA). [R064] A. Congress B. Federal Reserve Board The Federal Reserve Board administers the provisions of the Truth in Lending Act. [R083] X 28. According to RESPA, an Affiliated Business Arrangement (AfBA) disclosure must be provided
A. at the time of application, even if there are no AfBAs. X 29. RESPA requires the use of the HUD-1 for B. at or prior to the time a referral is made, if there is an AfBA. RESPA requires an Affiliated Business Arrangement (AfBA) disclosure whenever a settlement service provider involved in a RESPA covered transaction refers the consumer to a provider with whom the referring party has an ownership or other beneficial interest. The referring party must give the AfBA disclosure to the consumer at or prior to the time of referral. [R011] A. any commercial or residential property. C. one- to four-family residences. The HUD-1 is required only for one- to four-family residential properties (including condominiums and cooperatives). [R057] X 30. How many days from the day of application does the creditor have to deliver the mortgage servicing disclosure, GFE, and the Settlement Costs and You booklet? A. one C. three The creditor has three days to deliver these documents to the consumer (if they were not delivered at the time of application). [R034] X 31. While it is unlawful to consider race when underwriting a loan, what federal legislation requires that this information be included on the loan application? X 32. HOEPA is an addendum of A. Equal Credit Opportunity Act A. Regulation B. D. Regulation Z. C. Home Mortgage Disclosure Act The Home Mortgage Disclosure Act requires that this information be reported in order to determine whether discriminatory practices are being used. [R123] HOEPA is an addendum to Regulation Z (TILA). [R031] X 33. Which law ensures lenders use an annual percentage rate (APR) so that the borrowers have the information they need to make informed comparisons? A. Equal Credit Opportunity Act D. Regulation Z Under Regulation Z, lenders must use an annual percentage
rate (APR) so that the borrowers have the information they need to make informed comparisons among different lenders. [R115] 34. A borrower has a three-year right of rescission if the true APR on a fixed rate loan deviates from the final TIL by more than A. 1/8%. A. 1/8%. X 35. HMDA is also known as Regulation A. B. B. C. When the true APR deviates by more than one-eighth percent on a fixed rate loan, the borrower has a three-year right of rescission. [R002] HMDA was enacted by Congress and implemented by the Federal Reserve Board as Regulation C. [R027] Back