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NMLS Exam > NMLS PART 3 > Flashcards

NMLS PART 3 Flashcards

1
Q
  1. Do Ethics fall under state or federal law?
A
  1. Ethics (or “ethical issues”) are the basis of both state and federal law, and violating them may have legal consequences.
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2
Q
  1. How many days:
    a. A Loan Estimate? ______ business days after receipt of application
    b. If a loan estimate is revised? ____ business days from consummation
    c. An initial loan estimate before consummation? ____ business days
    d. If a customer sends in a qualified written request? _____ business days
    e. An appraisal disclosure for an HPML application? _____ business days
    f. After application, Your Home Loan Tool Kit? _____ business days
    g. After application, a Notice of Action Taken? ____ days
    h. A Closing Disclosure before consummation? _____ business days prior
    i. Notice of Incomplete Application – Within _______ days of application
    j. After submitting a loan application and receiving a loan estimate does a customer have to indicate an intent to proceed? ______ business days
A
  1. How many days:
    a. A Loan Estimate? 3 business days after receipt of application
    b. If a loan estimate is revised? (4 business days from consummation)
    c. An initial loan estimate before consummation? (7 business days)
    d. If a customer sends in a qualified written request? (5 business days)
    e. An appraisal disclosure for an HPML application? 3 business days
    f. After application, Your Home Loan Tool Kit? 3 business days
    g. After application, a Notice of Action Taken? 30 days
    h. A Closing Disclosure before consummation? (3 business days prior)
    i. After submitting a loan application and receiving a loan estimate does a customer have to indicate an intent to proceed? (10 business days)
    j. If application is denied, the adverse action taken must be disclosed to the consumer within? 30 days
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3
Q
  1. What is the most common “look-back period” to help find the index value that will be used to determine the fully-indexed rate?
A
  1. The most common “look-back period” is 45 days.
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4
Q
  1. If a loan is a conventional loan but is nonconforming, it is a __________ loan.
A
  1. Jumbo
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5
Q
  1. Homeowner’s Protection Act applies to:
    a. ¬¬¬¬¬¬¬__________
    b. __________
    c. __________
    d. But it does NOT apply to ____________
A
  1. HPA applies to:
    a. Lenders
    b. Loan Servicers
    c. Insurers
    d. (NOT appraisers)
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6
Q
  1. Who is a person who regularly refers applicants to creditors, or selects or offers to select creditors to whom requests for credit can be made?
A
  1. Brokers
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7
Q
  1. How long must a licensed originator maintain a valid license before having to re-take the NMLS exam?
A
  1. 5 years
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8
Q
  1. Who is responsible for renewing a mortgage originator’s license?
A
  1. The originator himself! (not the employer/broker)
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9
Q
  1. Under the S.A.F.E. Act, what must a loan originator submit to the NMLS?
A
  1. Reports of condition.
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10
Q
  1. The S.A.F.E. Act requires that ________ has participation in NMLS, conducting background checks, and writing rules and regulations:
A
  1. A state licensing agency
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11
Q
  1. In lien theory states, who holds the title to the home securing the mortgage throughout the loan term?
A
  1. The Borrower
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12
Q
  1. The obligation to serve as the agent or fiduciary of the borrower is imposed by?
A
  1. State Licensing Laws in Some States
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13
Q
  1. In order to contain a prepayment penalty, a mortgage must have the following 4 things:
    a. Term of mortgage must be __________
    b. DTI of _____________
    c. Points and fees of ______________
    d. Must have a ___________
A
  1. Prepayment penalties require:
    a. 30 years or less
    b. 43% or less
    c. 3% or less
    d. Fixed rate
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14
Q
  1. Steering customers toward disadvantageous loans by misrepresenting info on their credit report is a violation of:
A
  1. FCRA
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15
Q
  1. In ___________ Theory – borrower retains both legal and equitable title; the mortgage serves as a lien; judicial foreclosure needed in case of default
A
  1. Lien Theory – borrower retains both legal and equitable title; the mortgage serves as a lien; judicial foreclosure needed in case of default
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16
Q
  1. In ___________ Theory – lender holds legal title until the debt is paid; no courts needed in case of default
A
  1. Title Theory – lender holds legal title until the debt is paid; no courts needed in case of default
17
Q
  1. The Promissory note includes:
    a. _________
    b. _________
    c. _________
    d. _________
    e. _________
    f. DOES NOT include: _________
A
  1. Promissory note includes:
    a. Borrower’s name
    b. Loan amount
    c. Interest rate
    d. Loan terms
    e. Notices done in writing
    f. DOES NOT include “legal description of the property”
18
Q
  1. A loan processor or underwriter is exempt from licensure if:
    a.
    b.
    c.
    d. He cannot take loans __________________ a loan originator. To do that, he must be _________. All he can do is ______________ work for licensed or exempt brokers or originators.
A
  1. Loan Processor is exempt from licensure if:
    a. Is employed by a licensed mortgage broker
    b. Is employed by an exempt mortgage broker
    c. He does not represent to the public that he can perform any of the activities of a loan originator
    d. He cannot take loans on BEHALF OF a loan originator. To do that, he must be licensed. All he can do is clerical/support stuff for licensed or exempt brokers or originators.
19
Q
  1. Failure to report data to HMDA can result in civil or monetary penalties of:
A
  1. Calculated based on consideration for good faith; previous violations; and financial resources of the entity involved.
20
Q
  1. HPML’s require all borrowers to receive _____________
A
  1. Homeownership counseling
21
Q
  1. Which Act requires a “Notice of Right to Cancel PMI”?
A
  1. Homeowners Protection Act
22
Q
  1. “E-Sign Act” stands for:
A
  1. E-signc ACT (Electronic Safety in Global and National Commerce Act)
23
Q
  1. An originator’s disciplinary records and any enforcement actions taken against an originator, along with information about an originator’s employment history are:
    a. Confidential or non-confidential?
    b. Public or non-public?
A
  1. Not confidential, and a matter of public record
24
Q
  1. What is the mathematical equation for a periodic rate?
A
  1. Annual Rate / number of payments in a year
25
Q
  1. What is needed to waive the waiting period between receipt of the HOEPA disclosures and consummation of the loan? And how long is the required waiting period?
A
  1. The 3 day waiting period can be waived if they submit in writing a signed request that describes the emergency and consents to the waiver.
26
Q
  1. Under the S.A.F.E. Act, who would NOT be required to be licensed in order to do the work of a loan originator?
A
  1. Any employee of a federal, state, or local government agency or housing finance agency who acts a loan originator in the course of their employment.
27
Q
  1. According to TILA, you must provide a customer with ______ before collecting an ________.
A
  1. Closing Estimate; origination fee
28
Q
  1. In the Comparisons table of the Loan Estimate, what is not included?
A
  1. The cost of PMI before it hits 78%
29
Q
  1. Under GLB Act, when is a customer relationship established?
A
  1. Upon receipt of the application
30
Q
  1. Who does a Loss Payee Clause protect?
A
  1. The lender in the event the property is damaged by fire or other risks
31
Q
  1. What is a Completion Notice
A
  1. A Completion Notice is required of an appraiser, typically to document the completion of new construction prior to closing a loan on the property.
32
Q
  1. What are three issues that could cloud a title or affect marketability when examining title documents?
    a. _________
    b. _________
    c. _________
A
  1. 3 issues that could cloud a title:
    a. Easements
    b. Land Locks
    c. Leaseholds
33
Q
  1. What is the difference between a licensed mortgage originator and a registered loan originator?
A
  1. A licensed loan originator is licensed by the State and is an employee of a non-depository institution, while a registered loan originator is employed by a depository institution (or Farm Credit Administration).
34
Q
  1. What are 3 riders or addendums that a deed of trust may contain?
    a. _________
    b. _________
    c. _________
A
  1. 3 riders on a deed of trust?
    a. Balloon rider
    b. Prepayment penalty rider
    c. Second-home rider
35
Q
  1. How many hours of ethics are required for continuing education?
A
  1. Two

NMLS Exam (4 decks)

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