Uniform State Content Flashcards
Which of the following was issued by the CFPB to implement the Dodd-Frank Act requirements in January 2013 to build upon existing requirements under the SAFE Act?
the Loan Originator Rule
Which statement about a loan originator advertising to solicit mortgage business for his employing mortgage banker is FALSE?
The ad does not need to include license number of employing banker’s principal place of business.
A state-licensed MLO has resigned his position with his sponsoring employer to accept a new position as an MLO with a new licensed employer. Which statement is FALSE as it relates to the MLO changing his sponsorship status?
The new employer must access the company’s NMLS account and the individual MLO’s NMLS account to end the relationship with the existing employer and to request the new sponsoring relationship.
Registered mortgage loan originator refers to
an MLO who is registered with and maintains a unique identifier through the NMLS.
Which statement is TRUE in respect to the authority of the state regulator to conduct examinations and investigations of state-licensed mortgage lenders?
A mortgage lender must not knowingly withhold or destroy records.
Title V of the Housing and Economic Recovery Act of 2008 is more commonly known as the
SAFE Act
Lori is a state-licensed MLO working full-time for the Magnificent Mortgage Company, a licensed lender. She has been offered the opportunity to work part-time as an MLO for the Bravura Mortgage Company, another licensed lender, evenings and weekends. Can Lori lawfully accept the second job?
No, an MLO is prohibited from working for two companies as an MLO at the same time
Wishing Well Mortgage Company, a licensed residential mortgage lender, has one principal location in the state. Which other business location is considered a branch and therefore IS required to be licensed by the state regulatory authority as a residential mortgage lender branch office?
A leased office suite in a law office in which applications and fees for mortgage loans with Wishing Well are distributed and received from consumers
Which activity is defined as an administrative/clerical task?
Receive, collect and or distribute information common for the processing or underwriting of a loan
A licensed mortgage lender may NOT publish an advertisement that uses
A post office box number in place of the business address that appears on the license
Which number must be used to identify a mortgage loan originator on solicitations and advertisements?
NMLS unique identifier
The federal rulemaking authority for the SAFE Act is the responsibility of the
Consumer Financial Protection Bureau
The unique identifier of any person originating residential mortgage loans must be clearly shown on all of the following documents EXCEPT
Appraisal reports
To maintain a license in good standing, state law prohibits licensed MLOs from certain acts. Which of the following is NOT one of these prohibited acts?
An MLO disburses the mortgage loan proceeds into a customer’s account via direct deposit
A _____ is defined by the NMLS as the individual that represents a company and may be required to meet specific requirements.
Qualified individual
To be eligible to receive temporary authority to act as a state-licensed MLO, the licensee must have either been registered in NMLS as an MLO continuously during the one-year period preceding the application submission or licensed as an MLO continuously during the ___-day period preceding the date of application.
30
Which federal act requires that all states have in place a system of licensure for mortgage loan originators?
SAFE Act
The SAFE Act sets forth that each state regulatory entity has the authority to
Write state specific rules or regulations or adopt procedures related to licensing of persons covered under this Act
The SAFE Act mandates that there is public access and public display of the _____ assigned to any person originating residential mortgage loans, including display on any loan application forms and advertisements.
NMLS unique identifier
Which BEST describes the purpose of the NMLS Registry?
Facilitate electronic tracking and uniform identification of loan originators
Which law requires that all state-licensed mortgage loan originators pass a national licensing exam as a condition to be granted a license?
SAFE Act
The SAFE Act sets forth that _______ access to information or material relating to the employment history and disciplinary actions imposed on licensed mortgage loan originators.
There must be public
The Secure and Fair Enforcement for Mortgage Licensing Act of 2008 requires all mortgage loan originators originating residential loans to be licensed or registered with the
Nationwide Mortgage Licensing System and Registry
The temporary authority to act as a state-licensed MLO will expire ____ calendar days after the date the applicant was issued a temporary license.
120
The Secure and Fair Enforcement for Mortgage Licensing Act is designed to
Enhance consumer protection and reduce fraud through MLO licensing
The state entity responsible for mortgage lender licensing has received a customer complaint about XYZ Mortgage Company. For the purpose of investigating this complaint or any other complaints arising under the SAFE Act, the state licensing agency may investigate the licensee
At any time
What entity is responsible for enforcement of the SAFE Act at the federal level, including the authority to examine the records of a state-licensed MLO to investigate compliance with the SAFE Act?
Consumer Financial Protection Bureau
The SAFE Act sets forth that the CFPB may impose a civil penalty on a state-licensed MLO if the Director finds, after notice and opportunity for hearing, that the MLO violated any requirement of the SAFE Act. The maximum amount of penalty for each violation of the Act is _____. Annually, as required by federal law, the CFPB adjusts this penalty amount for inflation.
$25,000
The _____ Registry is the national database that tracks mortgage industry licensees and their licenses
NMLS
Each state must set forth license law that complies with SAFE Act’s continuing education requirements, including the requirement that MLO licensees complete how many total hours of education each calendar year?
8
Bernice is a state-licensed MLO in her state of residence. She must complete a minimum of 8 hours of continuing education to renew her license each year before December 31. The state has the authority to mandate that ___ hour(s) of the 8 hours be on either a state-specific topic or an elective topic.
1
As set forth by the SAFE Act, all persons originating mortgage loans must
Obtain a unique identifier through the NMLS
As set forth by the SAFE Act, the license law of each state must provide the state with the authority to oversee and regulate all the following aspects of MLO licensing EXCEPT the
Approval of continuing education courses
Which service is NOT typically conducted by the state regulatory authority?
Creates loan products to meet a variety of consumer needs
A mortgage banker and/or mortgage lender is
Any person who directly originates, acquires, or provides mortgage loans
As defined and used throughout license law, the term “individual” refers to a
Natural person
According to the Truth in Lending Act definition, which is considered a dwelling?
a duplex
As set forth by the SAFE Act, _____ is defined as any loan primarily for personal, family, or household use that is secured by a mortgage, deed of trust, or other equivalent consensual security interest on a residential structure or mobile home that contains one-to four-family housing units.
Residential mortgage loan
A loan processor refers to any person who
Performs certain administrative or clerical duties related to mortgage loans
As required by the SAFE Act, what DOES need to be included in a state’s system of supervision and enforcement of the SAFE Act?
Authority to subpoena witnesses and documents
Of these, which is considered a residential mortgage loan?
A loan for one to four family owner occupied property
As set forth in the SAFE Act, a state’s regulatory entity has the authority to require a licensee to satisfy a requirement specific to any of the following EXCEPT a
Loan origination funding amount
All of these are duties granted to a state regulatory authority under the SAFE Act EXCEPT for the duty to
Approve pre licensing and continuing education course offerings and course providers
As defined and used throughout license law, the term “immediate family member” does NOT include
Aunts, uncles, and cousins
Brenda earns a salary as well as a commission for every residential mortgage loan application she takes for her employer, a state-registered mortgage broker. Brenda must be a state
Licensed mortgage loan originator
The SAFE Act sets forth that states must establish minimum standards for the licensing and registration of state-licensed MLOs. Which of the following does NOT reflect a minimum standard that must be established for state MLO licensing?
The applicant must never have been convicted of a felony of any kind
Who is NOT “taking” a loan application?
Rita describes for a borrower the loan application process without any discussion of specific loan products
The SAFE Act sets forth that states must establish minimum standards for the licensing and registration of state-licensed MLOs. One minimum standard that must be set forth in state MLO license law is that applicants must furnish
An independent credit report obtained from a consumer reporting agency
Who IS “taking” a loan application?
Ellen responds to a borrower’s request for a different rate or fees by presenting the borrower with a revised loan offer
All of these activities are examples of offering or negotiating the terms of a loan EXCEPT
Making an underwriting decision about whether the borrower or prospective borrower qualifies for a loan
As defined by the SAFE Act, which IS an example of “offering or negotiating the terms of a loan”?
Communicating directly or indirectly with a borrower in order to reach a mutual understanding about prospective residential mortgage loan terms
Which of the following is a task that requires an MLO license to be legally performed?
Counsel consumers about available residential mortgage loan rates or terms
When can a mortgage lender employ an individual who is NOT state-licensed or state-registered to fulfill the duties of a mortgage loan originator for its company?
Under no circumstances
Doris performs only clerical duties for a licensed mortgage broker putting together loan packages. She is most likely a loan _________ from needing to be licensed as an MLO.
Processor that is exempt
Who IS exempt from licensing under the SAFE Act?
Juan, who negotiates the terms of a residential mortgage loan on behalf of his sister
Which license type may NOT be issued to a corporation?
Mortgage loan originator
Wayne has been hired by Reasonable Mortgage Company to collect or receive payments of principal, interest, and escrow due to the note holder for residential mortgage loans. Wayne’s job is
An individual loan servicer that does not require licensing
Model state law sets forth minimum qualifications for a state to issue an applicant an MLO license, including that the MLO needs to have demonstrated financial responsibility. Though state law may differ, model state law sets forth that an individual has not shown financial responsibility when there is a foreclosure within the past
3 years
Fingerprint images are required of every applicant as part of an initial MLO application in order to
Conduct a criminal background check
What topic is NOT required as part of the 20 hours of a mortgage loan originator applicant’s pre-licensing education?
Real estate concepts
A minimum of how many hours of approved pre-licensing education is required by the SAFE Act for state-licensed mortgage loan originators?
20
Who is NOT exempt from the MLO license and registration requirements as set forth by the SAFE Act?
Ben, who refers or steers a prospective borrower to a particular lender or set of residential mortgage loan terms with respect to his work duties
To be qualified for a license, an MLO license applicant must NOT have been convicted of a felony during the ______-year period immediately preceding the date of application for the license.
7
A state-licensed mortgage broker has maintained one principal location for eight years. The broker now wants to expand by opening another full-service brokerage office in another area of the same state. A mortgage _____is required for this expansion.
Broker branch office license
_____ is a minimum standard requirement for obtaining an MLO license with an active status.
Sponsorship
As set forth by the SAFE Act, what term is defined as an individual who takes a residential mortgage loan application and offers or negotiates terms of a residential mortgage loan for compensation or gain?
Mortgage loan originator
If an MLO license applicant fails the qualified SAFE MLO pre-licensing test three consecutive times, he will need to wait at least how long before taking the test again?
6 months
To pass the qualified SAFE MLO pre-licensing test, an MLO license applicant must achieve a minimum test score of
75%
____ is defined by the NMLS as a company’s indication that an individual MLO will conduct business under a specific license/registration for the company.
Sponsorship
An MLO license applicant must NOT have been convicted of a felony ______ if such felony involved an act of fraud, dishonesty, a breach of trust, or money laundering.
At any time
To achieve a score of 75%, license applicant Coleman may retake the qualified pre-licensing test ____ consecutive times with each consecutive test not occurring less than 30 days after the preceding test.
3
Which statement is FALSE as it relates to minimum standards for pre-licensing education and testing that must be met to obtain an MLO license?
If the test is failed 3 consecutive tests, the applicant must wait one year before taking the test again
If a licensed mortgage loan originator is convicted of a felony, the _____ is responsible for reporting this information to the NMLS.
Mortgage loan originator
When Bart’s sponsorship terminates, his mortgage loan originator license is given what status?
Inactive
Maureen, a licensed MLO, retakes the same 2-hour online course on the topic of nontraditional mortgage products that she took the previous year. She cannot count the 2 hours of education toward her continuing education requirements for license renewal this year because
She cannot receive credit for the same course taken in the same or successive years
The SAFE Act sets forth that to perform defined duties as an MLO in multiple states Jeff must meet national license requirements
And state license requirements for each state for which he conducts loan origination activities
A licensed MLO may credit a 2-hour online course in ethics toward his continuing education renewal requirement
Once in the same calendar year in which the course is taken
Every state-licensed MLO (in any approved status) is required to complete at least _____ of NMLS-approved education annually.
8 hours
The application for a state mortgage loan originator license is likely to be denied if the applicant
Scored only 70% on the National SAFE MLO pre licensing exam
A licensed mortgage loan originator must comply with requirements for license renewal
Annually by December 31
The time period that state-licensed MLO Maureen can submit her application for renewal is from
November 1 through December 31
According to the SAFE Act, each state must set forth the requirement that a person must be state-licensed as an MLO to legally perform which activity?
Assisting a borrower in obtaining a mortgage loan by offering to negotiate terms for a lender
The state regulatory authority will most likely deny a mortgage loan originator applicant a license if the applicant has
Ever been convicted of a felony involving fraud, dishonesty, breach of trust, or money laundering unless pardoned
Which will NOT be counted toward Kyle’s eight hours of National continuing education required by the SAFE Act to renew his loan originator license?
State approved 1 hour online course on state specific license law completed in the calendar year
Which of these situations require registration as a mortgage broker?
A company that offers, for a fee to place mortgage loans for others
All of the following documents require the inclusion of a licensee’s assigned NMLS unique identifier EXCEPT
A copy of the title report tied to a mortgage loan application
Sandy is a licensed MLO and an instructor of NMLS-approved continuing education (CE) courses. She is
Eligible to receive credit for annual CE requirements for hours taught
The state regulatory authority may refuse to renew MLO Diane’s license if there is a finding that she has
Demonstrated unfairness in the transaction of business
Avery is a formerly licensed MLO who has failed to maintain a valid license for six years. To become a state-licensed MLO again, she must
Retake and pass the qualified SAFE MLO pre licensing exam
The SAFE Act requires that the _____ be clearly shown on all residential mortgage loan application forms, solicitations, or advertisements.
MLO’s unique identifier
States must set minimum standards for MLO license renewal. All of the following are required minimum standards for state license renewal EXCEPT the MLO does NOT need to
Pass the annual NMLS renewal exam with a minimum score of 75%
Which statement is FALSE as it relates to providing disclosures required on individual or company license application forms submitted through the NMLS?
Application disclosure requirements for licensing in all states are the same
Which occurrence does NOT require the licensee to file a written report disclosing the occurrence to the NMLS and state regulatory authority?
Cooper, a licensed mortgage loan originator is cited for driving with an expired vehicle registration
Temporary authority to act as an MLO permits which of the following to originate loans while completing state-specific requirements for licensure?
Qualified applicants changing employment from a depository institution to a state licensed mortgage company
The state regulatory authority may issue an order suspending the license of a mortgage loan originator if the MLO
Fails to provide loan records at the request of a state examiner
Of the following, who is granted temporary authority to act as a loan originator while completing any state-specific requirements for licensure?
Danny, who is state licensed MLOs seeking MLO licensure in another state
A licensed MLO who terminates his affiliation with an employing mortgage broker but wishes to resume working as a mortgage loan originator in the near future may NOT
Originate loans during the time he is not affiliated with an employing entity
A person needs to submit an MLO license application through the
Nationwide Mortgage Licensing System and Registry
Which statement is FALSE in respect to providing books and records to a state examiner?
A mortgage lender may not maintain books and records at an out of state location
Pamela is employed to take residential mortgage loan applications for a federally-chartered bank. To legally do this job, she must be a
Registered mortgage loan originator
Applicants are required to provide a credit report as part of an initial MLO application primarily so the state regulatory authority can evaluate
The overall financial responsibility of the applicant
All of the following are requirements for the content of records that must be retained for examination by licensed lender’s activities EXCEPT for
Area market trends and competitor analysis
______ an MLO is allowed to pay for the advertising of a real estate agent in exchange for referrals.
Under no circumstances is
Which situation BEST describes the prohibited marketing practice of bait-and-switch?
MLO Hermione advertises a “no points” loan to entice borrowers but does not intend to offer it
The risk analysis of a mortgage lender must include all liabilities affecting income or assets that will affect the borrower’s ability to fulfill the mortgage payment obligation. When the credit report does not contain a reference for each significant open debt shown on the loan application,
The lender must provide separate credit verification
Inga is a loan processor that is NOT licensed as an MLO. Which of the following acts is a violation of the SAFE Act?
Inga circulates a business card that indicates she provides loan origination services
State regulators have the authority to do all of the following EXCEPT
Impose a prison sentence for purposeful violations of the SAFE Act that cause consumer harm
