50 Practice Test Questions

Question 1

What law deals with credit,APR & advertising of consumer loans ?

Answer 1

TILA/Reg Z

Question 2

Which Regulation Prohibits Kickbacks

Answer 2

RESPA(8)

Question 3

Which regulations requires the lender to cancel PMI when the loan reaches 78% LTV

Answer 3

HPA- Homeowners Protection Act

Question 4

Which regulation prohibits fee splitting

Answer 4

RESPA(8)

Question 5

“X” is the letter used to describe which Regulation

Answer 5

RESPA

Question 6

RESPA is the acronym used to describe which law

Answer 6

Real Estate Settlement Procedures Act

Question 7

What type of mortgage requires a non-refundable funding fee

Answer 7

VA Loan

Question 8

What is the provision in a mortgage enabling a lender to demand full repayment if the borrower DEFAULTS on the loan

Answer 8

Acceleration Clause

Question 9

What is the provision in a mortgage enabling a lender to demand full repayment if the borrower TRANSFERS the loan

Answer 9

Alienation Clause

Question 10

What does CFPB stand for

Answer 10

Consumer Financial Protection Bureau

Question 11

What two laws created the CFPB

Answer 11

Dodd Frank & Consumer Finance Protection Act

Question 12

Which regulation is designed to help meet the credit needs of the communities in which it operates

Answer 12

CRA- Community Reinvestment Act

Question 13

Under ECOA rules and regulations how many days does the borrower have to request a copy of the appraisal report if the application was denied

Answer 13

90 days

Question 14

Under ECOA rules and regulations how many days does the lender have to provide a copy of an appraisal report once requested by the borrower

Answer 14

30 days

Question 15

If a loan application is APPROVED under ECOA rules and regulations when must a copy of the appraisal be provided to the borrower

Answer 15

3 business days

Question 16

Conforming loans follow guidelines of which regulations

Answer 16

Fannie Mae and Freddie Mac

Question 17

Which regulations requires the lenders to “BE EQUAL” when extending credit to borrowers

Answer 17

ECOA -Reg B

Question 18

How old must a borrower be to qualify for a Reverse Mortgage

Answer 18

62 years or older

Question 19

Which regulations has the primary function of preventing Identity Theft

Answer 19

FACTA- FACT Act

Question 20

Which Regulation has the SECTION 114 Rules

Answer 20

FACTA- FACT Act

Question 21

Which regulation requires the creditor to verify the VALIDITY of any Change of address received

Answer 21

SECTION 114 of the FACTA- FACT Act

Question 22

What is the payment method used in a reverse Mortgage that allows the homeowners to receive a monthly check while living in the property

Answer 22

TENURE Method

Question 23

What is the fraud scheme where a borrower uses someone else’s name to purchase the property but that person will not be living in the property

Answer 23

Straw Borrower

Question 24

What government lender “insures” mortgages

Answer 24

FHA

Question 25

What government lender "guarantees" mortgages

Answer 25

VA Loans

Question 26

What government lender loans money to fund purchases in rural areas

Answer 26

USDA/DEPT. of Agriculture

Question 27

What is the value remaining in the property after all liens and debts have been paid

Answer 27

Equity

Question 28

A borrower is refinancing a home. How much time does Reg Z give him to change his/her mind

Answer 28

3 days

Question 29

Which regulation establishes the 3 day right of rescission rule

Answer 29

TILA Reg Z

Question 30

Redlining is part of which regulation/Law

Answer 30

Fair Housing Act

Question 31

Blockbusting is part of which regulation/law

Answer 31

Fair Housing Act

Question 32

Steering is part of which regulation/law

Answer 32

Fair Housing Act

Question 33

Trying to convince q homeowner to sell his home by implying that another race/ethnicity is moving in the neighborhood is called

Answer 33

blockbusting

Question 34

trying to convince a homeowner to purchase in a particular neighborhood based on his race religion or ethnicity is called

Answer 34

Steering

Question 35

Refusing to make loans on a property in a certain neighborhood for disrriminatinatory reasons is called

Answer 35

Redlining

Question 36

What does HOEPA stand for

Answer 36

Home Ownership Equity Protection Act

Question 37

HOEPA Loans are part of which larger regulation

Answer 37

Reg Z/TILA

Question 38

High Cost Loans are part of which larger regulation

Answer 38

Reg Z/ TILA

Question 39

High Priced Loans are part of which larger regulation

Answer 39

Reg Z/ TILA

Question 40

SECTION 32 Loans are part of which larger regulation

Answer 40

Reg Z/ TILA

Question 41

Section 35 Loans are part of which larger regulation

Answer 41

Reg Z/TILA

Question 42

MDIA ACT is part of which larger regulation

Answer 42

Reg Z/TILA

Question 43

Mortgage Disclosure Improvement Act is part of which larger regulation

Answer 43

Reg Z/TILA

Question 44

What is another name for annual percentage rate

Answer 44

effective rate

Question 45

What is another name for Interest Rate

Answer 45

Note/ Nominal Rate

Question 46

PITI divided by Gross Monthly income is referred to as what

Answer 46

Housing Ratio Or Front End DTI Ratio

Question 47

PITI + monthly debt divided by gross Monthly income is referred to as what

Answer 47

Total Obligation Ratio or Back End Ratio

Question 48

How long must TILA Disclosures be kept

Answer 48

- Generally 2 years - LE for 3 years - CD for 5 years

Question 49

What is the maximum amount of time that negative info can remain on a credit report

Answer 49

7 years

Question 50

What is the maximum amount of time that a bankruptcy can remain on a credit report

Answer 50

10 years