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SAFE > MLO BASICS (27%) > Flashcards

MLO BASICS (27%) Flashcards

1
Q

Who is appointed on behalf of the bureau to determine if an MLO is within compliance?

A

The EXAMINER can be initiated by the CFPB whenever deemed necessary

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2
Q

What are some types of conventional non-conforming loans?

A
  1. Jumbo loans
  2. Niche loans
  3. Nontraditional ARMs like option ARMs
  4. Graduated payment mortgages
  5. Subprime mortgages
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3
Q

What is the guaranty under a VA loan?

A

The amount the VA may pay a lender in the event of lost due to foreclosure. The max guarantee the VA will pay is 25%.

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4
Q

What is the single-family housing guaranteed loan program?

A

Designed for moderate income borrowers and only available in the form of a 30 year fixed rate loan

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5
Q

What are the qualifying standards for an FHA HECM?

A

The underwriter will look at:
1. Age of the youngest borrower
2. Current interest rate
3. Max claim amount
4. Initial Mortgage Insurance Premium

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6
Q

What is a unique feature of an FHA loan?

A

If a property with FHA financing is re-sold within 90 days of the date of its purchase, the property will not be eligible for an FHA mortgage loan

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7
Q

Which fees are not considered customary and reasonable to the federal housing administration?

A

The processing fee and the expediting fee

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8
Q

What two disclosures from TILA and RESPA created the closing disclosure?

A

The HUD-1 and the final TIL

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9
Q

What two disclosures from TILA and RESPA created the loan estimate

A

The good faith estimate and the initial TIL

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10
Q

What is the URLA?

A

The uniform residential loan application, a.k.a. form 1003

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11
Q

What will lender rebates or lender credits do for a borrower?

A

Lender rebates can be purchased by a borrower to reduce their closing costs for each point their closing cost will decrease. In exchange, their interest rate increases along with their monthly.

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12
Q

What happens when a borrower uses/buys points to permanently buy down their interest rate?

A

Their monthly payment will decrease, but their closing cost will increase

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13
Q

When must an originating mortgage banker disclose a lender rebate?

A

Application and at or before closing

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14
Q

The good faith estimate is only given for

A

Open-end loans

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15
Q

Which products are conventional conforming?

A
  1. Fixed rate
  2. ARM
  3. Hybrid ARM
  4. Super conforming
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16
Q

What is the automated underwriting system used by FHA and VA loans?

A

TOTAL

17
Q

What is a piggyback loan?

A

Provides a loan to cover a down payment for a first loan
80/20
80/10/10
Avoid PMI payment by not having an LTV percent greater than 80%

18
Q

What is recording and when does it happen?

A

Recording is the very last step in the MLO timeline after the loan is consummated the closing agent must record the documents and make sure everything is signed correctly

19
Q

What is table funding?

A

When the loan is closed at the table by the loan originator

20
Q

What is forbearance?

A

Short term relief for a borrower that doesn’t want to foreclose due to missed payments

21
Q

Mortgage lenders always use which number to calculate a borrowers per diem interest?

A

30

22
Q

What is the DD214 used for?

A

A form needed to prove a veteran was released or discharged from active duty under any condition other than dishonorable

23
Q

What is on page 3 of the closing disclosure?

A

Comparisons/confirm receipt
Calculating cash to close breaks down, closing costs seller, credit deposit totals after deposits and credits and compares if anything changed from the LE
Summaries of transactions further breaks down, cost from LA showing what is due at closing and shows what funds are going to who and who they came from

24
Q

What is a security instrument?

A

A legal document giving the lender a security interest in the financed property.
A mortgage, in which the lender has a lien on the property, or a deed of trust, which gives the lender title rights to the property, are both examples of a security instrument

25
Q

What is Strict Foreclosure?

A

A type of foreclosure where the lender fles a lawsuit against the borrower to obtain legal title to the home. Once the court process is complete the lender will typically send the home to an auction to be sold

26
Q

What standards do appraisers follow?

A

USPAP
Uniform
Standard
Professional
Appraisal
Practices

27
Q

What is on each page of the URLA (form 1003)?

A
  1. Borrower information
  2. Financials- assets and liabilities
  3. Financials- real estate
  4. Loan and property information
  5. Declarations
  6. Acknowledgments and agreements
  7. Military service
  8. Demographic information
  9. Loan Originator information

Continuation sheet
Lender Loan information

28
Q

What is BACK END RATIO

A

PITI+ any association dues+ long term debts / GMI

SAFE (4 decks)

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