Chapter 8: Ethics and Fraud

Question 1

Which of the following prevents a mortgage broker from choosing the appraiser for loans?
A. RESPA
B. Home Valuation Code of Conduct (HVCC)
C. ECOA
D. TILA

Answer 1

Answer B

The Home Valuation Code of Conduct (HVCC) prevents a mortgage
broker from choosing the appraiser for loans that are sold to Fannie Mae. TheDodd-Frank Act extended the law to include all mortgages.

Question 2

An individual who obtains or has obtained a financial product or service from a financial institution for personal, family or
household reasons. 
A. Customer 
B. Applicant 
C. Consumer 
D. Client

Answer 2

Answer C

A consumer is an individual who obtains or has obtained a financial product or service from a financial institution for personal, family or household reasons.

Question 3

An individual with a continuing relationship with a financial institution.
A. Customer 
B. Applicant 
C. Consumer 
D. Client

Answer 3

Answer A

A customer is a consumer with a continuing relationshipwith a financial institution.

Question 4

*** An appraisal result can only be reported to the
A. client, real estate agents, state regulatory agencies and peer review committees.
B. client, lenders, state regulatory agencies and peer review committees.
C. client, client-authorized individuals, state regulatory agencies and peer review committees.
D. client, MLO, state regulatory agencies and peer review committees.

Answer 4

Answer C

An appraiser must keep client information and appraisal results
confidential. Results can only be reported to the client, client-
authorized individuals, state regulatory agencies and peer reviewcommittees.