Still need work question Flashcards
When does the process of title report take place?
A. After appraisal and before title policy insurance is issued.
B. After Title Policy before closing
C. After Closing
D. Three days if application
Answer
A
After appraisal and before title policy insurance is issued.
Which of the following is issued after closing? A. Title Report B. Title insurance binder C. Title insurance policy D. Title fee
Answer C.
The title insurance policy itself is issued after closing, and the title insurance premiumis a one-time closing cost to either the seller or borrower.
Which of the following has full purchase price mortgage coverage? A. Mortgagor title insurance B. Mortgagee Title insurance C. Title deed D. Title Premium
A. The mortgager title insurance covers the full purchase price of the mortgage
Which of the following cover only the loan amount? A. Mortgagor title insurance B. Mortgagee Title insurance C. Title deed D. Title Premium
B. The mortgagee title insurance covers the loan amount
Which of the following about title insurance is not true?
A. Either the seller or buyer (or both) will pay for the policies
B. The lender requires it, but does not pay for it.
C. If the lender requires it, they pay for it
D. Whoever pays the title insurance picks the title company.
C is not true.
The lender requires it, but not require to pay for it.
What is the process called with the title company investigate county records to verify that the title is clear (free of any defects or judgments) and the seller has the right to sell the property? A. Initially Appraisal B. Preliminary title report C. Title defect D. Title binder
Answer B
When a property not fully paid off is used as a collateral, what documents are required?
A. Deed, Mortgage Statement, homeowners insurance declarations, appraisal
B. Deed, title insurance, promissory note, appraisal
C. Deed, Mortgage Statement, homeowners insurance declarations, appraisal,notice of satisfaction
D. Deed, title insurance, notice of satisfaction promissory note, appraisal
Answer A.
On a mortgage collateral not fully paid off, a deed, mortgage statement or note, HOA declaration and appraisal is needed
When a property fully paid off is used as a collateral, what documents are required?
A. Deed, Mortgage Statement, homeowners insurance declarations, appraisal
B. Deed, title insurance, promissory note, appraisal
C. Deed, Notice of Satisfaction, homeowners insurance declarations, appraisal
D. Deed, title insurance, notice of satisfaction promissory note, appraisal
C
Which of the following is not true about Escrow analysis?
A. Determine the appropriate escrow target balances
B. It is done annually and sent to buyer
C. Compute the borrower’s monthly payments for the next escrow account computation year and any deposits needed to establish or maintain the account; and
D. Determine whether shortages, surpluses or deficiencies exist.
Answer C.
It’s the annual escrow that’s sent out yearly not the escrow analysis
On a 1003 application, which of the following can sign for an absent party? A. Power of Attorney B. Spouse C. Court Appointed Guardian D. Relative
Answer: C.
Court Appointed Guardian or POA only for those in military or incapacitated
Who prepares the Final 1003? Lender or mortgage broker? A. The MLO B. The Lender C. The Realtor D. The sponsor
B. The Final 1003 application is prepared at the time of loan closing and is prepared by the lender.
Which of the following contains the six items on the Type of mortgage and terms of mortgage section on a FNMA 1003?
A. Type of loan, agency and lender case number
B. A. Type of loan, agency and lender case number
C. Loan type, agency and lender case number, loan amount, interest rate, terms and amortization type
D. Loan type, agency and lender case number, loan amount, interest rate, terms and monthly payments
Answer C
In this section, the lender indicates:
- Type of loan applied
- Agency and Lender Case Numbers.
- Loan amount;
- Interest rate;
- Term in months
- Amortization Type
On FNMA 1003 borrower information section, which of the following are included?
A. Name, home phone, address, zip code, age, agent number
B. A. Name, home phone, address, zip code, age, MLO number
C. Name, Social Security Number, home phone, address age of the borrower, and number of years of school completed, and whether the borrower is a renter or owner.
D. Name of borrowers, phone, Social Security Number, home phone, age of the borrower, and new property address
Answer C
Full name of the primary borrower and co-Borrower, Social Security Number, home phone, age of the borrower, and number of years of school completed, Borrower’s present address, and whether the borrower is a renter or owner.
On the employment section of a FNMA, what type of information is requested of the borrower and co-Borrower?
A. Name, number address of employer, business type, position held, number of years c employed and monthly Income.
B. Name, number address of employer, business type, position held, number of years c employed and yearly Income.
C. Name, number address of employer, net gross, position held, number of years c employed and monthly Income.
D. A. Name, number address of employer, number of employees, position held, number of years c employed and monthly Income.
A
In Asset and Liability section on 1003, which of the following is listed as on the asset?
A. Cash Deposit, Bank name, Account Number and amount
B. Cash Deposit, Bank name, Account Number and how long account has been opened
C. Bank name, Account Number and amount
D. Bank name, Account Number and how long account has been opened
Answer A
Assets - Cash Deposit, Name of bank, Account number and Amount
In the Asset and Liability section on 1003, which of the following is listed as on the liability?
A. Name of company, balance and collateral
B. Name of company, account number and late payments
C. Name of company, Account Number, Monthly payments and months left to pay, Unpaid balance
D. Name of company, Account Number, Account age
Answer c
Liability- Name of company, Account Number, Monthly payments and months left to pay, Unpaid balance
*In the Details of Transaction section on 1003, which of the following is the information pulled from? A. Loan Estimate/Good Faith Estimate? B. Closing Disclosure C. HUD-1 D. FNMA 1008
Answer A
Which is true of a blanket authorization form?
A. The MLO can request the VOD be sent directly to the mortgage company
B. The applicant must sign this form to authorize his or her employer(s) to release the requested information.
C. The Blanket Authorization must be notarized
D. Lenders must attach a copy of the authorization form to each VOD it sends to the depository institutions in which the applicant has accounts.
D
A mortgagee applicant looking to purchase a first home and gave you a blank copy of the VOE, what should you do?
A. Have the borrower hand carry the form to the employer to fill out.
B. Have the borrower call the lender
C. Have the borrower give to his or her employer to fill and send back to lender
D. Deliver it yourself to the lender
Answer C.
The applicant must sign this form to authorize his or her employer(s) to release the requested information.
A mortgagee applicant looking to purchase a secondary home and gave you a blank copy of the VOE, what should you do?
A. Have the borrower hand carry the form to the employer to fill out or have the employer send to lender
B. Have the borrower call the lender
C. Have the borrower give to his or her employer to fill and send back to you to give the lender
D. Deliver it yourself to the lender
A.
A secondary home can be hand carry or employer to lender direct
Methods of verification can be provided by
A. The borrower, borrower’s employer, or by third-party employment verification vendor.
B. Only the borrowers employer
C. The borrower employer and third party
D. Third party verification is not legal
Answer A
which of the following is true when verifying employment?
A. Two year employment history for wage earners only
B. Two year employment history for contract worker only
C. 1099 for self employed
D. A two-year employment history is required for both wage earner and self-employed borrowers.
D
What document is acceptable as employment document provided by the borrower?
A. Recent two years W2, Tax returns and IRS Form 4506-T.
B. Paystubs, tax returns and Award letters
C. W2, bank statement and IRS Form 4506-T.
D. Recent two years W2, Paystub 30 day, and IRS Form 4506-T.
Answer. D
Remember this is proof of employment not proof of income
What type of document is acceptable document for verification of employment?
A. 30 day paystub that is computer-generated, typed by the borrower’s employer(s), or downloaded from the Internet
B. Last two most recent paystub that must be in company documents and never typed or downloaded
C. Most recent paystub that can be downloaded, typed or handwritten by employer
D. Paystub provided by third party
A
which if the following may be computer-generated forms, including online account or portfo-lio statements downloaded by the borrower from the Internet? A. Verification of Deposit B. Verification of Income C. Retirement statements D. Third Party Verifications
C
Copies of retirement statements may be computer-generated forms, including online account or portfo-lio statements downloaded by the borrower from the Internet.
When Retirement statements are faxed or downloaded from the internet, it must
A. Include an opt-out page as the first page of the fax
B. Clearly Clearly identify the name of the MLO and the source of information by including it on the banner at the top of the document
C. Clearly identify the name of the depository or investment institution and the source of information by including it on the banner at the top of the document
D. Have a clearly written title page with full transparency
C
Documents that are faxed to the lender or downloaded from the Internet must:
clearly identify the name of the depository or investment institution and the source of information—for example, by including that information in the internet or fax banner at the top of the document.
What’s true of non-liquid assets?
A. It helps paint a better picture of borrowers liability
B. It must be counted to establish positive net worth.
C. It’s not counted as asset or liability
D. It’s only required for QM loans
Answer B
For most borrowers, non-liquid assets must be counted to establish positive net worth.
How are reserved measured?
A. Reserves are measured by DTI ratio
B. Reserves are measured by the number of months of monthly housing expenses (PITI) that a borrower could pay using his or her financial assets.
C. They are measured by assets that can be sold easily
D. All of they above
Answer B
Reserves are measured by the number of months of monthly housing expenses (PITI) that a borrower could pay using his or her financial assets.
Federal Taxes, retirement payments, commuting cost, union dues, voluntary deductions are
A. Included in borrowers obligation
B. Not included in borrowers obligation
C. Included as income
D. Not included as income
B
Which of the following are examples of non-employed income?
A. SS benefits, food stamps, child support
B. retirement income, interest, and dividend income, rent, or royalties.
C. Self employed income when taxes have been taken off
D. Part time or independent contractor jobs
B
Which of the following are examples of non-taxable income?
A. SS benefits, food stamps, child support
B. retirement income, interest, and dividend income, rent, or royalties.
C. Self employed income when taxes have been taken off
D. Part time or independent contractor jobs
A
Award letters and policy agreements are examples of A. Self employed income B. Taxable income C. Non-taxable income D. Non-Employed income
C
Award letters are disabled
Who is required to sign the security instrument?
A. Spouse or domestic partner of any person who has an interest in the property, even if their income or credit is not involved
B. Only spouse or domestic partner of any person who is also a co-signer on the deal
C. Only those whose income is used on the loan
D. Only those whose credit was used on the loan
A
Who is required to sign the security instrument?
A. Only the borrower and co-borrowers
B. Each person who has an ownership interest in the security property and income is used in qualifying for the mortgage.
C. Each person who has an ownership interest in the security property, even if the person’s income is not used in qualifying for the mortgage.
D. Each person who has an ownership interest in the security property such as those whose credit is used to determine approval.
C
In the absence of the borrower, who is not someone that can sign the security instrument?
A. Court appointed guardian
B. Relative with a notarized Power of attorney
C. Realtor with a notarized Power of attorney
D. Attorney -in-fact or agent under a power of attorney
C
In the absence of the borrower, who is someone that can sign the security instrument?
A. Spouse
B. Anyone with a notarized power of attorney
C. Court appointed guardian
D. All of the above
C
Which of the following are acceptable sources of down payments and closing cost? A. Personal checks B. Cashiers check C. Credit card D. Debit card
B
Which of the following is not an acceptable method and source of down payments and closing cost? A. Personal check B. Proceeds from the sale C. Cashiers Check D. All of the above
Fannie Mae requires guaranteed funds such as a cashier’s check from a bank or reputable financial institution to pay the closing costs; personal checks are not acceptable.
Reserve requirements for multiple properties on a . 1-4 property home is A. 2% B. 4% C. 6% D. 8%
Answer A
Reserve requirements for multiple properties on a 5-6 Properties is A. 2% B. 4% C. 6% D. 8%
Answer 4
Reserve requirements for multiple properties on a 7-8 Properties is A. 2% B. 4% C. 6% D. 8%
C
In a reserve for multiple properties, which of the following is true of the reserve on homes that have 2% of the aggregate UPB (Unpaid Balance Principal)? A. 2 Unit B. 1-4 Unit C. 2-4 Unit D. 3-4 Unit
Answer B
1-4 Properties = 2% of the aggregate UPB (Unpaid Balance Principal)
In a reserve for multiple properties, which of the following is true of the reserve on homes that have 4% of the aggregate UPB (Unpaid Balance Principal)? A. 2 Unit B. 1-4 Unit C. 4-6 Unit D. 5-6 Unit
D
In a reserve for multiple properties, which of the following is true of the reserve on homes that have 6% of the aggregate UPB (Unpaid Balance Principal)? A. 2-4 Unit B. 5-6 Unit C. 7-10 Unit D. 8-10 Unit
Answer C
Even numbers only 1, 5, 7
7-10 Properties = 6% of the aggregate UPB if the borrower has seven to ten financed properties (DU only).
According to the definitions in the model state law, all of the following would be included as a federal banking agency, except:
A. The Board of Governors of the Federal Reserve System.
B. The Federal National Mortgage Association.
C. The Comptroller of the Currency.
D. The Federal Deposit Insurance Corporation.
Answer C
Biden DNC F
Board of Governors/Federal Reserve System.
Director of the Office of Thrift Supervision,
National Credit Union Administration.
Comptroller of the Currency.
Federal Deposit Insurance Corporation.
Which of the following QM loans does not have to abide by the 43% DTI? A. General and Small Creditor QM B. Temporary and Balloon only C. Temporary and Small Creditor D. General and Balloon QM
C. Temporary, Small Creditor QM have more flexibility on DTI
Which of the following QM loans can be originated by all creditors? A. General and Temporary QM B. Temporary and Balloon only C. General and Balloom D. Temporary, Small Creditor and balloon
Answer: A
General and Temporary QMs – can be originated by all creditors.
What are four types of QM loans?
A. General, conventional, temporary, ballon
B. General, non-conventional, temporary, ballon
C. General, Temporary, Small Creditor, Balloon
D. General, Temporary, Small Creditor, FNMA
Answer: C
There are four types of QMs – General, Temporary, Small Creditor, and Balloon-Payment. Of the four types of QMs, two types – General and Temporary QMs – can be originated by all creditors.
Which of the following QM loans are eligible for purchase or guarantee by Fannie Mae or Freddie Mac and insured by the Federal Housing Administration or Rural Housing Service? A. General and Temporary B. Temporary and Balloon only C. General and Balloon D. Temporary QM only
Answer: D
General and Temporary QMs – can be originated by all creditors.
Which of the following QM loans requires 43% DTI? A. General and Small Creditor QM B. Temporary and Balloon only C. Temporary and Small Creditor D. General and Balloon QM
D. General and Balloon QMs requires 43% DTI
Initial Closing Disclosure must delivered to the borrower \_\_\_\_\_business days prior to loan consummation? A. Three Days B. Three business day C. Four days D. Seven business days
B
A final Closing Disclosure is delivered When? A. Three Days B. Three business day C. Four days D. At consummation
Answer D
Which of the following is delivered three business days prior to consummation? A. Initial Til B. Initial Closing Disclosure C. Final Closing Disclosure D. Escrow analysis
B
Which of the following is delivered at consummation? A. Initial Til B. Initial Closing Disclosure C. Final Closing Disclosure D. Escrow analysis
C
Loan originators moving from a depository institution to a non-depository institution requires them to be have been registered for how long before requesting temporary authority? A. 30-day B. 60 days C. 1 year D. 2 years
C
How long does temporary authority last? A. 30-day B. 60 days C. 120 days D. 1 year
C
Loan originator moving interstate must be licensed in another state how many days before applying for temporary authority? A. 30-day B. 60 days C. 1 year D. 2 years
A
If a mortgage broker is receiving yield spread premium on a loan transaction, on which of the following documents must the amount be disclosed?
A. borrower/broker agreement
B. Affiliated business arrangement disclosure
C. TIL Disclosure
D. GFE
D
Which of the following fees is not included on the Good Faith Estimate?
A. loan origination fees
B. real estate taxes
C. discount points
D. real estate broker fees
D. real estate broker fees
Yield spread premium is disclosed to the borrower:
A. on the TIL Disclosure and promissory note
B. only on high cost loans
C. only on purchase transactions
D. on the GFE and Settlement Statement
D. on the GFE and Settlement Statement
You must re-disclose the APR on a loan prior to closing if:
A. it changes by more than 1/2 of 1% from its initial disclosure
B. it is more than 1% greater than it was at the time of its initial disclosure
C. 30 days have elapsed since the time of the initial disclosure
D. it varies by more than 1/8 of 1% from its initial disclosure
D. it varies by more than 1/8 of 1% from its initial disclosure
The Real Estate Settlement Procedures Act includes all of the following provisions except?
A. it prohibits receipt of referral fees
B. it establishes the maximum origination fee that may be charged on a loan
C. it requires the use of a uniform settlement statement
D. it limits the kids of business affiliations that settlement service providers may create
B. it establishes the maximum origination fee that may be charged on a loan
Under the Truth-in-Lending Act, a mortgage professional is required to disclose_______to a borrower.
A. personal financial information provided by a credit reporting agency
B. appraisal results
C. terms of the credit transaction
D. estimated closing costs
C. terms of the credit transaction
Settlement fees and other charges related to a loan transaction must be recorded on the HUD-1 Settlement Statement as:
A. estimated percentages of the loan amount
B. estimated dollar amounts
C. actual percentages of the loan amount
D. actual dollar amounts
D. actual dollar amounts
If a creditor violates ECOA, how many years does a consumer have in which to take civil action?
A. 10
B. 5
C. 2
D. 1
C. 2
When calculating finance charges in compliance with TILA, all of the following are included except:
A. private mortgage insurance premium
B. settlement fees
C. broker fees
D. appraisal fees
D. appraisal fees
The Real Estate Settlement Procedures Act applies to:
A. residential lot loans
B. residential loans
C. residential investment properties such as condos and duplexes
D. commercial loans
B. residential loans
Which of the following federal agencies creates the regulations for TILA?
A. HUD
B. Federal Reserve
C. FHA
D. Federal Trade Commission
B. Federal Reserve
*** Mr. Jones’ loan application has been denied and you provide him with an Adverse Action Notice as required by ECOA. Which of the following pieces of information would NOT be included on the notice?
A. a description of credit he requested
B. his credit score
C. information on the credit reporting agency if the adverse action is based on his credit report
D. reasons for the denial of credit
B. his credit score
Jack Smith has been turned down for a loan. He would like to receive a copy of his appraisal. When must the lender receive his request for the appraisal?
A. within 90 days of application
B. within 30 days after Jack has received a notice of the right to receive the appraisal
C. within 90 days after Jack has received the notice of adverse action
D. within 30 days of the appraisal
Consumer have 90 days after reverse action to request for appraisal
C. within 90 days after Jack has received the notice of adverse action
Incomplete application must be retained for how long? A. 25 months B. 2 years C. 3 years D. 5 years
A
Which of the following is true of Purchase Money Mortgage?
A. Used for home purchase, refinance, home equity and home improvement
B. Not used for refinance, home equity, and home improvement
C. used for the purchase of a home, and refinance,
D. used for the purchaseof a home and not a refinance
Answer: B
Remember this loan is between buyer and seller and thus is only for home purchases
Which of the following is the theory state when the borrower receives the deed at closing and obtains occupancy of the property? A. Lis Pedens Theory B. Lien State Theory C. Deed State Theory D. Title State Theory
B
In a lien state Theory, who secures the debt? A. Mortgage B. Mortgagee C. Third Party D. Trust
A
When the mortgagee (lender) or a third party keeps the deed until the loan is satisfied is known as A. Lis Pedens Theory B. Lien State Theory C. Deed State Theory D. Title State Theory
D
