Funding and Closing

Question 1

Who is the middleman between the MLO and appraiser?

Answer 1

Appraisal Management Company (AMC)

Question 2

TRUE OR FALSE: Finished basements can be included in the finished living space on an appraisal.

Answer 2

False

Question 3

TRUE OR FALSE: The income approach is used to appraise an investment or multi-unit property.

Answer 3

True

Question 4

Which type of appraisal is most commonly used?

Answer 4

Sales approach

Question 5

TRUE OR FALSE: The title report will show whether there are any tax liens on the property.

Answer 5

True

Question 6

The simplest form of ownership

Answer 6

Ownership in Severalty

Question 7

Which type of lien is superior to the rest?

Answer 7

Property Tax Liens

Question 8

What is considered the repeated refinancing of loans that have no benefits to the borrower?

Answer 8

Churning

Question 9

Which sections on page 2 of the Closing Disclosure are considered “10% tolerance”?

Answer 9

B. Services Borrower Did Not Shop For (majority of)

Question 10

Which sections on page 2 of the Closing Disclosure are considered “zero tolerance”?

Answer 10

A. Origination Charges

Question 11

Which sections on page 2 of the Closing Disclosure are considered “no tolerance”?

Answer 11

C. Services Borrower Did Shop For and “Other Costs”

Question 12

TRUE OR FALSE: Conventional loans are not assumable.

Answer 12

True

Question 13

Per Reg B of ECOA, when should the lender give the borrower a copy of the appraisal?

Answer 13

at least three days before closing

Question 14

TRUE OR FALSE: If the fixed interest rate increases by more than 1/4th of a percent, a new disclosure is required.

Answer 14

False

Question 15

TRUE OR FALSE: If you mail the CD on Monday, you can close the following Monday.

Answer 15

True

Question 16

TRUE OR FALSE: MLOs should always be present at their borrowers’ closings.

Answer 16

False

Question 17

TRUE OR FALSE: The borrower must notify the creditor if they want to rescind their loan by midnight of the third business day after closing.

Answer 17

True

Question 18

What are the 3 types of involuntary liens?

Answer 18

Tax liens, mechanics liens and judgement liens

Question 19

Harmful refinancing by lenders that potentially takes away a homeowner’s equity with unnecessary loans is _________.

Answer 19

Churning

Question 20

If you issue the closing disclosure in person on a Friday, on which day could you close?

Answer 20

The next Tuesday

Question 21

The _______________ policy must be at least equal to the original principal mortgage amount.

Answer 21

Lender’s title insurance

Question 22

What are the 3 types of co-ownership?

Answer 22

Tenancy in common, joint tenancy and tenancy by the entirety