Exam-Federal Law Flashcards
The Fair Credit Reporting Act covers all of the following, EXCEPT:
a) Disclosing obligations on users of consumer reports
b) Prohibiting discrimination regarding the handicapped
c) Regulating the consumer reporting industry
d) Ensuring fair, timely and accurate reporting of credit information
b) Prohibiting discrimination regarding the handicapped
Regulation B allows all of the following except:
a) inquiries about the ages of dependents.
b) inquiries about citizenship and residency status.
c) using the terms husband or wife when inquiring about a potential co-borrower.
d) Inquiring about paying child support and/or alimony
c) using the terms husband or wife when inquiring about a potential co-borrower.
HMDA requires the lenders to obtain what information for each borrower?
a) Age and Race
b) Race and Sex
c) Marital status and Sex
d) Marital status and Age
b) Race and Sex
A borrower elects to buy down the interest rate on his mortgage loan, using three discount points. This appears on the Loan Estimate and would be considered a:
a) Zero Tolerance Fee
b) 10% Cumulative Tolerance Fee
c) No Tolerance Fee
d) 10% Tolerance Fee
a) Zero Tolerance Fee
Under what law is a lender required to provide an adverse action disclosure if the borrower’s credit is the reasoning for all or part of the decision to deny the loan application:
a) Regulation Z
b) Regulation X
c) Regulation C
d) Regulation B
d) Regulation B
HMDA is the acronym for:
a) House and Mortgage Deposit Act.
b) Home Mortgage Discovery Act.
c) Home Mortgage and Development Act.
d) Home Mortgage Disclosure Act.
d) Home Mortgage Disclosure Act.
FCRA is the acronym for:
a) Federal Credit Reporting Act.
b) Federal Certificate of Reimbursement Act.
c) Fair Credit Reporting Act.
d) Federal Community Redevelopment Act.
c) Fair Credit Reporting Act.
GLBA allows a lender to do which of the following?
a) Share a borrower’s information with those necessary to complete the loan request
b) Share a borrower’s information with anyone if no fee is received
c) Sell a borrower’s information to anyone as long as it is private
d) Sell a borrower’s information with the parent company, affiliates and non-affiliates
a) Share a borrower’s information with those necessary to complete the loan request
RESPA imposes requirements about, or prohibits, all of the following, except:
a) the loan origination fee.
b) the amount of prepaids.
c) information that must be disclosed to the borrower at the loan application or within 3 business days of the application.
d) kickbacks and referral fees.
a) the loan origination fee.
If an applicant has been denied credit, how long does the lender have to get a letter of adverse action to him/her?
a) 10 days
b) 15 days
c) 30 days
d) It is not necessary to send a letter, as long as the borrower knew they had bad credit before they applied.
c) 30 days
The practice of getting people to sell their homes at bargain prices by suggesting that certain ethnic groups are going to move into the area is nicknamed:
a) Price fixing
b) Redlining
c) Steering
d) Blockbusting
d) Blockbusting
Which of the following is a purpose of RESPA?
a) To regulate interest rates
b) To monitor high cost loans
c) To eliminate kickback and referral fees
d) To track real estate settlement trends
c) To eliminate kickback and referral fees
You and the borrower believe an Adjustable Rate Mortgage would be best for the borrower. What is the name of the booklet you are required to give?
a) CHARM Booklet
b) ARM Disclosure
c) Fair Lending Practices Booklet
d) RESPA Booklet
a) CHARM Booklet
CFPB is the acronym for:
a) Congressional Fair Public Business Act.
b) Consumer Financial Protection Bureau.
c) Consumers Federal Policy Bureau.
d) Congressional Federal Protection Board.
b) Consumer Financial Protection Bureau.
Which of the following is an acceptable condition on which to base a mortgage loan originator’s compensation?
a) On what type of interest rate the loan has
b) The LTV amount on the loan
c) A fixed percentage of the loan amount
d) Based on the term of the loan
c) A fixed percentage of the loan amount
If a loan is a refinance, and the loan is improperly closed and funded in one day with no three-day rescission period, how long do the borrowers have to rescind the transaction?
a) One day
b) Three days
c) One week
d) Three years
d) Three years
How many days in advance of transferring a loan to another lender must the current mortgage servicer inform that customer of the transfer to another lender who will subsequently be servicing the loan?
a) 15
b) 20
c) 3
d) 45
a) 15
Which of the following is a protected class under the Fair Housing Act?
a) A handicapped individual
b) A person 62 years of age or older
c) An African-American
d) An American Indian
a) A handicapped individual
What is the maximum penalty for providing false information on a federally related loan?
a) $5,000 fine and one year jail time
b) $250,000 fine and 30 years jail time
c) Revoke license and $1,000 fine
d) Up to $1,000,000 fine and jail time
d) Up to $1,000,000 fine and jail time
An MLO is required to protect a borrower’s non-public personal information, per what federal law?
a) Regulation B
b) Regulation X
c) Regulation Z
d) Regulation P
d) Regulation P
If a loan originator is in a face-to-face loan interview with the applicant, and the applicant does not wish to answer the questions in Section 10 on the 1003 , the loan officer must:
a) research and obtain the information.
b) end the process.
c) check the box “I do not wish to furnish this information”.
d) fill out the information based on visual observation.
d) fill out the information based on visual observation.
All the following could not be considered a higher-priced loan, except:
a) A reverse mortgage
b) A home equity line of credit
c) An initial construction loan
d) A purchase loan
d) A purchase loan
A Loan Estimate:
a) Must be within $500 of the final costs
b) Is an estimate only and is not required to reflect the actual settlement costs
c) Should exhibit a reasonable relationship to the actual final settlement costs
d) Must be within $1,000 of the final costs
c) Should exhibit a reasonable relationship to the actual final settlement costs
A mortgage broker provides tickets for an NFL game to a title company executive for referring customers to them. Which federal law does this arrangement violate?
a) RESPA
b) TILA
c) SAFE Act
d) Loan Originator Compensation
a) RESPA
Which federal law is responsible for the creation of the CFPB?
a) TILA
b) TRID
c) Dodd-Frank
d) The SAFE Act
c) Dodd-Frank
Regulation Z requires:
a) disclosure of the settlement costs to buyers and sellers.
b) disclosure of the impound accounts and the prepaids of the borrower(s).
c) computation and disclosure of the APR to the borrowers.
d) disclosure of servicing information on the loan.
a) disclosure of the settlement costs to buyers and sellers.
If the file is incomplete, for borrower non-performance a declination letter must be sent within:
a) 10 days
b) 15 days
c) 30 days
d) It is not necessary to send a letter if the file is incomplete
d) It is not necessary to send a letter if the file is incomplete
The responsibility of financial institutions to meet both the deposit and credit needs of the community, including the needs of low- income families, is called?
a) the Home Mortgage Disclosure Act.
b) the Community Reinvestment Act.
c) the Fair Credit Reporting Act.
d) the Equal Credit Opportunity Act.
b) the Community Reinvestment Act.
An MLO who supplied a revised LE to a borrower must retain that document for:
a) 5 years
b) 90 days
c) 1 year
d) 3 years
d) 3 years