SAFE ACT

Question 1

Created by the Dodd-Frank Act and the Consumer Finance Protection Act.

Answer 1

CFPB

Question 2

Who sees compliance over the SAFE Act

Answer 2

CSBS, AARMR, and CFPB

Question 3

NMLS stands for

Answer 3

Nationwide Mortgage Licensing System & Registry

Question 4

CSBS/AARMR duties:

Answer 4

maintains the registry, approves mortgage schools and courses, and oversees state compliance.

Question 5

Took control of Fannie Mae and Freddie Mac in 2008.

Answer 5

Federal Housing Finance

Question 6

Applicant information is stored in a

Answer 6

National register

Question 7

Consumers can search for:

Answer 7

non-confidential licensee information.

Question 8

Federal banking agencies

Answer 8

Federal Reserve System Board of Governors,

National Credit Union Administration, Comptroller of the currency and the Federal Deposit Insurance Corporation.

Question 9

Loan processors and underwriters who function as independent contractors must be:

Answer 9

state-licensed loan originators and register with the NMLSR.

Question 10

All applicants need to provide their

Answer 10

fingerprints, credit report and criminal

background check authorizations.

Question 11

The NMLS does not give a person their license, only a

Answer 11

State can give someone their license

Question 12

The NMLS uses a generic application, known as the

Answer 12

MU4

Question 13

Applicants for LO must have no felony for the last

Answer 13

Seven years

Question 14

FHA Underwriting Machine

Answer 14

Total Scorecard

Question 15

Continuing education must include

Answer 15

3 hours of federal law, 2 hours of ethics, and

2 hours of training on non-traditional mortgage products.

Question 16

The NMLS unique identifier is required on

Answer 16

ALL MARKETING MATERIAL

Question 17

All disclosures require the

Answer 17

MLO’s unique identifier.

Question 18

A licensed MLO who is an approved instructor may receive credit for their annual CE requirement at the rate of 2 hours’ credit for every 1 hour taught.

Answer 18

instructor credit

Question 19

Loan originators may not cause a borrower to obtain property insurance coverage in an amount that exceeds the

Answer 19

replacement cost of the improvements as

established by the property insurer.

Question 20

a quarterly report of the condition an entity submits thru the NMLS.

Answer 20

Mortgage Call Reports

Question 21

The MCR report is comprised of two parts:

Answer 21

The state-level “Residential Mortgage Loan Activity Report” and the entity level “Financial Condition Report”.

Question 22

The state-level “Residential Mortgage Loan Activity Report” is completed:

Answer 22

quarterly, within 45 days of the end of the calendar quarter.

Question 23

The entity level “Financial Condition Report” is completed:

Answer 23

annually, within 90 days of the company’s fiscal year end.

Question 24

Loan originator organizations can receive compensation for selling additional products such as title insurance, but

Answer 24

individual loan originators may not.

Question 25

Penalty for violating SAFE Act:

Answer 25

$28,474

Question 26

occurs when a property is purchased at a low price, appraised at an inflated value without any valid reason for the increase, and then resold at a much
higher price.

Answer 26

Illegal Flipping

Question 27

an abusive practice in which a loan is refinanced without any tangible net benefit to the borrower.

Answer 27

loan flipping

Question 28

FHA imposes restrictions requiring the borrower not to resale the property for

Answer 28

the first 90 days

Question 29

FHA requires the lender to investigate the transfer history of property for _____ before resale, in an attempt to identify potential flipping schemes.

Answer 29

the past three years

Question 30

Is the intentional hiding or altering of a material fact

such as income or tax documents.

Answer 30

Material misrepresentation

Question 31

Material misstatements are:

Answer 31

are untrue statements related to financial status.

Question 32

Omission

Answer 32

is the intentional leaving out of information.

Question 33

These individuals are allowed to originate loans while completing any state specific requirements for licensure such as education or testing for up to…

Answer 33

120 days while they are applying to the state agency for their new license.

Question 34

Temporary Authority can be awarded to:

Answer 34

qualified state-licensed MLOs seeking licensure in another state and MLOs who are changing employment from a depository institution to a state-licensed mortgage company

Question 35

Once unlicensed for five (5) years, the individual must…

Answer 35

Retake and pass the National Exam. Licensing –Additional Info

Question 36

Title V of HERA is also known as the…

Answer 36

SAFE Act

Question 37

EXEMPTIONS UNDER THE SAFE ACT:

Answer 37

Any individual who performs administrative or clerical tasks for licensee. Extending credit on timeshare plan. Individuals who negotiate a mortgage loan for themselves or IMMEDIATE family members. Attorneys who negotiate loan terms as an ancillary service and who aren’t compensated by a loan originator or lender.