Preschools Wrong Questions

Front 1

CLTV is calculated?

Back 1

closed-end+ drawn amt/ value

Front 2

TLTV is calculated?

Back 2

HELOC limit or cap + closed-end /value

Front 3

Under the Dodd-Frank, offering to provide a product or service that is not in fact available is considered

Back 3

deception is not limited to situations in which the consumer has already been misled;It may also be deceptive if it is likely to mislead consumers. Deceptive acts or practices include offering to provide product or service that is not in fact available.

Front 4

For loans with a prepayment penalty, typically a borrower may not prepay more than ___ percent of the loan balance in a single calendar year without penalty.

Back 4

20%

Front 5

Information held by NMLS relating to the employment history or disciplinary actions taken against a mortgage loan originator

Back 5

is not protected by confidentiality and is available for public access.

Front 6

From 1-4 family investment property in which the owner will not live, FNMA and FHLMC require a reserve of how many months PITI?

Back 6

6 months

Front 7

In the calculation of an applicant's income, a capital gain can be considered if

Back 7

the borrower owns additional capital assets

Front 8

Which of the following is true regarding rate sheets?

Back 8

The more points paid by the borrower up-front, the lower the interest rate charged over the duration of the loan.

Front 9

A lock-in option in which the interest rate and points are frozen at the same time after the application but before settlement is called

Back 9

floating interest rate, floating points

**floating interest rate, floating points is often called "float-to-lock" freezes the interest rate and the points at some points at some time after the application.

Front 10

Due to the principal-agent problem, compared to borrowers who obtain loans through retail sources, borrowers of loan originated by brokers are

Back 10

more likely to prepay faster

Front 11

A home is appraised at $100,000. The borrower currently has a loan of $50,000, an open-end line of credit with a limit of $25,000 and a current balance of $17,500. What is his LTV?

Back 11

50%

loan $50,000/ value $100,000

Front 12

Which of the following would qualify as a simultaneous loan under the definitions of TILA and Reg-Z?

Back 12

An additional covered loan on the same dwelling made to the same borrower before closing on the covered transaction.

Front 13

Under the MARS, rule all of the following disclosures must be provided by mortgage assistance relief company to a consumer, EXCEPT

Back 13

that if a consumer chooses to reject an offer obtained by the provider from the lender or servicer, he must still pay the provider's fee.

Front 14

RESPA is administered by the

Back 14

CFPB

Front 15

Under HOEPA, a high-cost loan may have a balloon payment under all of the following circumstances EXCEPT

Back 15

the borrower signs a waiver consenting to the balloon payment

**a high-cost loan may not provide for a payment schedule with regular periodic payments that result in a balloon payment, unless the payment schedule is adjusted for the irregular or seasonal income of the borrower.

Front 16

In regard to obtaining property, the SAFE act states that loan originators

Back 16

must not do so by fraud or misrepresentation

Front 17

RESPA requires that when an escrow account is required to manage tax and insurance payments, an initial escrow account statement showing all payments to be deposited and all disbursements to be made from the escrow account during the following year must be given to the borrower at or within___ days after settlement.

Back 17

45 days

**when an escrow account is required to manage tax and insurance payments, an initial escrow account statement showing all payments to be deposited and all disbursements to be made from the escrow account during the following year must be given to the borrower at or within 45 days after settlement

Front 18

A lender can be protected for loss by encumbrances or a defective title through

Back 18

title insurance

**when a title insurance company receives for title insurance, a title examiner will perform a title search in the title plant and the recorder's office.

Front 19

Under the SAFE act, a licensed loan originator responsibilities in regard to record keeping include all of the following EXCEPT

Back 19

not knowingly withholding, removing, or destroying any books or records.

Front 20

Which of the following does NOT appear on the HUD-1 settlement statement?

Back 20

APR

The real estate broker commission appears in section 700. The origination charge appears on the HUD 801. Discount appears on line 802. The APR is not a loan fee or real estate closing costs, so it does not appear on the HUD-1.

Front 21

The Uniform Residential Loan Application includes a section requesting information for government monitoring . Applicants must complete this section

Back 21

Only if they wish

**This section is completed at their option. If they decide not to answer these questions, they check the "I do not wish to furnish this information" box.

Front 22

Which law requires a loan originator to provide a special information booklet to a borrower?

Back 22

Real Estate Settlement Procedures act

RESPA requires that a lender or mortgage broker provide the borrower with a special information booklet prepared by HUD within three business days of receiving a mortgage loan application.

Front 23

The number one ethical problem cited in surveys of professionals and managers is

Back 23

false or misleading representation of products or services in marketing, advertising or sales.

Front 24

Under RESPA, when a loan servicer sells or assigns loan servicing rights to another loan servicer, the borrower can not be penalized for making a timely payment to the prior servicer within ____ days of the loan transfer.

Back 24

60 days

**when a loan servicer sells or assigns loan servicing rights to another loan servicer, the borrower cannot be penalized for making a timely payment to the prior servicer within 60 days of the loan transfer.

Front 25

In regard to reduced-documentation loans, the Guidance specifies that consumers should be alerted to

Back 25

any pricing premium related to such loans

**if a provider offers both reduced- and full- documentation loan programs, consumers should be alerted to any pricing premium attached to the reduced-documented program

Front 26

Under TILA, in a closed-end transaction secured by real property or a dwelling, the disclosed finance charge and any disclosure affected by the finance charge (ex, APR) are considered accurate if the finance charge is understated by ___ or less or if it is overstated.

Back 26

$100

**in closed-end transaction secured by real property or a dwelling, the disclosed finance charge and any disclosure affected by the finance charge (Ex, APR) are considered accurate if the finance charge is understated by $100 or less if overstated.

Front 27

Charging a borrower broker fees when the borrower never met or knew of broker, charging borrowers for a detailed appraisal when only a drive-by appraisal was done, and itemizing charges that are duplicative or should be included under other charges are all aspects of a predatory lending practice called

Back 27

padding

Front 28

TILA specifies that for each variable rate loan program in which a consumer expresses interest, the required loan program disclosure must include all of the following EXCEPT

Back 28

a statement that other lenders may offer similar ARM products at competitive rates

Front 29

When a broker falsifies information on loan applications by overstating income and/or assets or by understating liabilities of the applicant, this is termed

Back 29

broker-facilitated fraud

**one of the most common types of fraud involves mortgage broker facilitation in misrepresenting , misstating, or omitting information used to underwrite a loan (ex,overstating income, and/or assets or understating liabilities of the applicant) with or without the borrower's participation.

Front 30

In the comparison of GFE and HUD-1, charges are divided into sections based on

Back 30

tolerance to change

**the comparison chart must be prepared using the exact information and amounts from the GFE and the actual settlement charges shown on the HUD-1. It has three sections: 1.charges that cannot increase. 2. charges that cannot increase more than 10% 3.charges that can change

Front 31

May a creditor finance credit insurance premiums in connection with a mortgage loan transaction?

Back 31

No, this is prohibited by TILA

**a creditor may not finance any premiums and fees for credit insurance in connection with a consumer credit transaction secured by a dwelling (including home equity lines of credit)

Front 32

What type of loan processing would include only an appraisal and a credit score?

Back 32

no documentation

in a true no-doc loan, employment, income, and assets are not stated on a loan application and only the applicants credit and the property value are verified.

Front 33

Under regulation X, a lender must keep records relating to the HUD-1 and escrow accounts for___ years and documentation for GFE for ___ years.

Back 33

five;three

Front 34

Which of the following is NOT a finance charge?

1.LO fee

2.appraisal fee

3.Mortgage insurance premium fee

4.mortgage broker fee

Back 34

Appraisal fee

**finance charges include;loan fees,mortgage broker fees,service charges,pts, and mortgage insurance premium,LO fees,and interest.

Front 35

According to TILA's ATR rule, in making a QM, required underwriting standards include calculation of monthly payments using the maximum interest rate apply during the loan's first ___ years.

Back 35

5 years

Front 36

Credit Insurance - Insurance Packing

Back 36

Typical insurance products sold in connection with loans include credit life, credit disability, credit property, and involuntary unemployment insurance, and debt cancellation and suspension agreements. Lenders frequently charge exorbitant premiums, which are not justified based on the extremely low actual loss payouts. Frequently, credit insurance is sold by an insurance company which is either a subsidiary of the lender or which pays the lender substantial commissions. They over-insure borrowers by providing insurance for the total indebtedness, including principal and interest, rather than merely the principal amount of the loan.

Front 37

Padding Closing Costs.

Back 37

In this scheme, certain costs are increased above their market value as a way of charging higher interest rates. Examples include charging document preparation fees of $350 or credit report fees of $300, which are many times the actual cost

Front 38

Under RESPA, the mortgaging servicing disclosure statement discloses

Back 38

whether loan servicing may be assigned or transferred while the loan is outstanding.

Front 39

Under HOEPA, verifying the consumer's repayment ability in an open-end, high-cost mortgage

Back 39

is based on verifying income, assets and current obligations.

Front 40

in regard to the role of credit scores in loan underwriting and borrower payment shock, the CSBS-AARMR guidance recommends that providers

Back 40

avoid over reliance on credit scores

Front 41

A person has how many years from the time of occurrence of an alleged ECOA violation to file a civil suit against the creditor?

Back 41

5 years

Front 42

A loan applicant received a $20,000 gift from a relative to assist in the purchase of a home within the 60 days prior to the purchase agreement or loan application. this will be treated from the lender as a?

Back 42

gift

**the gift has been in the borrowers account, over 60 days , it would have been 'seasoned' and treated as an asset.

Front 43

Which 3 disclosures must be provided under the MARS rule?

Back 43

1.the lender may agree to any modification to the consumer's loan.

2.that if the consumers stops making payments on his mortgage, he could lose his home and damage his credit.

3.the company is in no way affiliated with the government and does not have any sort of special approval from the government or the consumer's lender.

Front 44

With regard to adjustable loans with interest rate caps, its true that

Back 44

the loan payments may increase even if the index rate decreases.

Front 45

The residential loan application includes a section requesting information for government monitoring. Applicants must complete this section.

Back 45

only if they wish

**this is optional, if they wish not to furnish this information box

Front 46

Under TILA's rules in regard to higher-priced loans, a creditor or servicer may cancel an escrow account only upon the earlier of termination of the underlying debt obligation, or ___ years after the loan was consummated, at the request of the consumer.

Back 46

5 years later

Front 47

Under RESPA, a loan originator is no longer bound by the GFE if a borrower does not express an intention to continue with an application within ___ business days after GFE is provided.

Back 47

10 days

Front 48

TILA states that for each variable -rate loan program in which consumer expresses an interest, the required loan program disclosure must include all of the following.

Back 48

1.a statement that disclosure forms are available for the lender's other variable-rate loan programs.

2.the fact that the loan program contains a demand feature.

3.a statement that the consumer should ask about the current margin value and current interest rate.

Front 49

when a mortgage accepts a legitimate application and documents from a buyer and submits them to two lenders, it is called

Back 49

double-selling

Front 50

The BSA and the USA patriot act require that covered financial institutions share information with

Back 50

both other financial institutions and federal law enforcement agencies

Front 51

A mortgage typically does not

Back 51

transfer title to the lender

Front 52

Which law requires distribution of the CHARM booklet?

Back 52

TILA

Front 53

Which type of loan processing would only include only an appraisal and a credit score?

Back 53

no documentation

Front 54

In regard to reduced-documentation loans, the Guidance specifies that consumers should be alerted to

Back 54

any pricing premium related to such a loan

Front 55

All of the following might serve as mitigating factors in a creditors decision to offer risk layering, EXCEPT

Back 55

a higher-priced property securing the loan.

Front 56

For a VA loan, a CRV is below the sales price of property, the borrower

Back 56

may purchase the property at purchase price, if he pays additional amount in cash.

**a veteran may not borrow more than the value shown on the CRV.

Front 57

Which clause allows payments to be made jointly to both the lender and the homeowner if the subject property is damaged?

Back 57

Mortgage clause

Front 58

For an FHA 30-year loan with a minimum downpayment, the annual MIP, must be paid for how long?

Back 58

must be paid for the life of the loan

Front 59

Which of the following is a characteristic of a USDA loan section 502 guaranteed loan?

a.3.5% down payment requirement

b.the interest rate is adjustable

c.it has a 30 year term

d.the interest rate is set by the USDA

Back 59

c.it has a 30 year term

for moderate income borrowers, the USDA has a guaranteed loan program, section 502, which is similar to that offered by the VA, as the loans have 30 year term, a fixed interest rate set by the lender, and no required down payment.

Front 60

After consummation of the loan, the lender must provide the consumer with new disclosures if any of the following occurs EXCEPT?

a. loan refinancing

b. acquisition of the lender

c.adjustment in a variable rate loan

d.loan assumption

Back 60

b. acquisition of the lender

Front 61

After conducting an escrow analysis, a loan servicer must deliver an annual escrow statement to the borrower, summarizing all account deposits and payments during the computation year, within___ calendar days after the end of the escrow account computation year.

Back 61

30 days after the end of the escrow account computation year.

Front 62

A prepayment penalty that applies to any prepayment, including from the sale of the property, is called ______ prepay penalty

Back 62

Hard prepay penalty

**when it applies to a refinance it is a soft prepayment penalty. for a sale of property it is called a hard prepay penalty.

Front 63

The Federal do-not-call implementation act allows licensees to call persons

a. on the registry if they responded to an information hotline within the last three months.

b.who are not listed on the registry

c. on the registry if they have done business with those persons within the last 18 months

d.all of the above

Back 63

all of the above

Front 64

In connection with a consumer credit transaction secured by a consumer's principal dwelling, a servicer must provide an accurate statement of the total outstanding balance required to pay off the debt more than ____ business days after receiving a request from the consumer.

Back 64

7 days

Front 65

The most secure type of earning, and the easiest to calculate is ______.

Back 65

base earnings

**the most secure type of income, and therefore the easiest to determine and verify is base earnings.

Front 66

In lieu of a surety bond or net worth requirement, a state may require a loan originator to...

Back 66

pay a certain amount into the state consumer protection fund

Front 67

Under RESPA, in response to a borrower's written complaint involving the servicing of his loan or escrow account questions, a servicer must acknowledge it within ____ business of receipt, and resolve it within ____ business days.

Back 67

- acknowledge complaint within 5 days

- resolve it within 30 business days

Front 68

Under TILA's QM rule, a QM of $100,000 or more may not have points and fees that exceed _____ percent of the total loan amount.

Back 68

no more than 3% of the total loan amount

Front 69

The interest rate that would be charged if there were no additions or subtractions to the rate because of discount points is called

Back 69

par rate

the interest rate that would be charged if there were no additions or subtractions to the rate because of discount points.

Front 70

An escrow account established at closing per a lender's requirement to pay property taxes and insurance premiums is typically controlled by

Back 70

the loan servicer

**loan servicer establishes or controls this account on behalf of a borrower to pay property taxes, property insurance premiums (including flood insurance), mortgage insurance premiums or other charges with respect to his mortgage insurance premiums.

Front 71

Prior to being taken over by the government, Fannie Mae and Freddie Mac were known as

Back 71

Government Sponsored Enerprises

Front 72

Which of the following is permitted in a high-cost loan under HOEPA?

a.negative amortization

b.a prepayment penalty more than 36 months after consummation

c.consolidation of two periodic payments to be paid in advance from the procedures

d.an increase in the interest after default

Back 72

c.consolidation of two periodic payments to be paid in advance tom the procedures.

Front 73

A lock-in option in which the interest rate and the numbers are capped but the borrower may get the loan at a lower rate if rates float down is called?

Back 73

a float down rate lock

a float down rate lock caps the interest rate and the number of points but allows the borrower to get the loan at a lower rate, if rates float down.

Front 74

Under the definitions of the Dodd-Frank Act, taking unreasonable advantage of lack of understanding on the part of the consumer of the material risks, costs or conditions of the product or service in which kind of act?

Back 74

abusive

Front 75

All of the following are considered "changed circumstances" under regulation X except

a.information about the estimated value of the property found to be inaccurate after the GFE has been provided.

b. an act of god

c.market fluctuations

d.new information particular to the borrower that was not provided on the GFE

Back 75

market fluctuations

Front 76

Under the BSA, a Currency Transaction Report (CTR), which is not filed electronically must be filed within____ days following the day on which the reportable transaction occurred.

a.15

b.20

c. 5

d.10

Back 76

15 days

Front 77

May a creditor extend credit to a first-time borrower in connection with a closed-end mortgage transaction, when the terms of the loan may result in negative amortization?

Back 77

yes, only if the borrower has received homeownerhip counseling

Front 78

Under the Guidance, providers must ensure that any offer of nontraditional mortgage products complies with all applicable laws and regulations, including the prohibition against prohibiting unfair or deceptive acts or practices, which is a part of

Back 78

Section 5 of the FTC , prohibits unfair or deceptive acts or practices.

Front 79

Under the truth in lending requirements, a creditor's ad that contains the APR must also include the following?

a.amount financed

b.interest rate

c.monthly payments

d.none of these, APR must be presented by itself

Back 79

under truth in lending requirements, a creditor's ad that contains the APR need not include any other specific loan terms

Front 80

Under TILA and Reg Z, a lender may not extend higher-priced mortgage loan to a consumer without obtaining, prior to consummation

a. notarized statement that the borrower has read and understood the terms of the loan.

b.certification that the borrower is qualified to make a financial decision.

c. a written appraisal of the property serving as collateral.

d. a signed statement that a borrower has researched other loan options before committing to a higher-priced loan.

Back 80

a written appraisal of the property serving as collateral

Front 81

All of the following statements are true of APR, EXCEPT

a.It is the same as the nominal rate shown in the note.

b.it is usually higher than the nominal rate.

c.it enables the borrower to compare the percentage costs of different loans.

d.It represents the relationship of the total finance charge to the total amount financed, as

Back 81

it is the same as the nominal rate shown in the note

Front 82

Under regulation P and the Gramm-leach-bliley act, non-public personal information includes

a. the assessed value of the property securing the loan.

b.the customers current loan balance.

c.a customers phone number.

d.the address of a property securing a loan.

Back 82

b. a customers current loan balance.

Front 83

Which of the following is TRUE of the fully indexed rate?

a.initial rate +margin =fully indexed rate

b.indexed rate + margin =fully indexed rate

c.margin+cap=fully indexed rate

d.fully indexed rate +margin= indexed rate

Back 83

indexed rate + margin =fully indexed rate

Front 84

Under the FHA's property flipping prohibition, a property resold within ____ from the last sale is not eligible for FHA financing, with certain exceptions

a. 90 days

b.six months

c.one year

d.60 days

Back 84

90 days

with an arm's length transaction to encourage investors to fix and flip foreclosures, if the owner's acquisition exceeds 20% this rule is waived.

Front 85

The problem with asset-based loans arises because lenders fail to consider what?

Back 85

the borrowers ability to repay the debt

Front 86

Which of the following is true regarding the qualification of an applicant who receives child support and alimony?

a.this income cannot be considered, as it is not earned income

b.child support income can be grossed up

c.child support can be included as income, but alimony can't

d.child support payments

Back 86

child support income can be grossed up

Front 87

The rate at which the amount financed (the loan amount less the prepaid finance costs) produces the loan payment is the

a. annual interest rate

b.equity growth rate

c.amortization rate

d.annual percentage rate

Back 87

annual percentage rate

Front 88

The minimum number of comparibles for a mortgage appraisal are?

Back 88

3 comps

Front 89

A 20 year, fixed-rate loan would qualify as a non-taditional loan under the definitions of

a.neither the guidance, nor the safe act

b.the guidance only

c.both the guidance and the safe act

d.the safe act only

Back 89

d.the safe act only

Front 90

Under the guidance what is a non-traditional mortgage product?

Back 90

refers to closed-end mortgages

Front 91

State departments or agencies granted the authority to adopt and implement the SAFE act

a.are typically state educational departments

b.are given unlimited authority in regard to mortgage legislation

c.may be a division with a larger umbrella agency

d.are always headed by a commissioner

Back 91

may be a division with a larger umbrella