Uniform State Content Flashcards
The unique identifier of a person originating a residential mortgage loan must be clearly shown on all the following, except:
all internal office communications.
The Secure and Fair Enforcement for Mortgage Licensing Act of 2008 is a key component of what Federal Law?
Housing and Economic Recovery Act of 2008
A Residential Mortgage Loan Originator employed by a federally insured depository institution:
must be registered.
Which of the following persons is not exempt from licensing under the SAFE Act?
An individual who is an independent contractor engaging in residential mortgage loan origination activities as a loan processor or underwriter.
All licenses issued shall be valid for a term of not more than one year from the date of issuance and shall expire:
on December 31st of the year issued.
What government entity has backup authority to establish a loan originator licensing system if it determines that the Nationwide Mortgage Licensing System and Registry is failing to meet the requirements and purposes of the SAFE Act:
Consumer Financial Protection Bureau.
To meet the annual continuing education requirements required by the SAFE Act, a licensed mortgage loan originator shall complete:
At least 8 hours of education approved by the Nationwide Mortgage Licensing System and Registry.
A licensed mortgage loan originator who subsequently becomes unlicensed must complete the continuing education requirements:
For the last year in which the license was held prior to issuance of a new or renewed license.
To meet the written test requirement of the SAFE Act, an individual must achieve a test score:
of not less than 75 percent correct answers to questions.
For purposes of the SAFE Act, a person has shown that he or she is not financially responsible when they show a disregard in the management of their own financial condition. Which of the following would best indicate that an individual has not shown financial responsibility?
A pattern of seriously delinquent accounts within the past 3 years
As defined by the SAFE Act, a traditional mortgage loan is:
Any 30-year fixed-rate mortgage loan.
An individual who completed 20 hours Pre-Licensure education but failed to acquire a valid state license as a mortgage loan originator within three years must:
complete 20 hours of Pre-Licensure education.
An individual may retake a test 2 consecutive times, with each consecutive taking occurring at least 30 days after the preceding test. After failing 3 consecutive tests, an individual shall:
Wait at least 6 months before taking the test again.
Xavier has been charged with alleged violations of his state’s SAFE Act. Before a civil penalty may be imposed on him, the state is required to:
provide Xavier notice and an opportunity for a hearing.
Which of the following best describes a Balloon Mortgage?
A partially amortized loan with a final payment substantially larger than the others.
What is the name of the percent added to the index to calculate the payment interest rate on an ARM?
Margin
When a loan gains status as a Qualified Mortgage, it carries with it a legal presumption of complying with the Ability to Repay requirements. The CFPB’s final rule creates two different kinds of legal presumption: a safe harbor and:
rebuttable presumption.
A standardized conventional loan written on uniform documents that meets the purchase requirements of Fannie Mae (FNMA) and Freddie Mac (FHLMC) is defined as a:
Conforming loan.
The purpose of the Rural Housing Guaranteed Loan Program is to enable eligible low to moderate-income rural residents to acquire modestly priced housing for:
Primary residences
Which of the following is not considered one of the 4 categories of a Qualified Mortgage (QM)?
High-Cost QM Loan
The U.S. Department of Veteran Affairs does not make loans, it:
Guarantees loans made by lenders to qualified veterans.
Conventional conforming guidelines specify that if the mortgage is secured by a second home or an investment property, the borrower may own or be obligated on up to:
ten financed properties (including his or her principal residence).
A loan program best described as a loan where a borrower makes payments to principal and interest every two weeks rather than once a month is called a:
Bi-Weekly mortgage.
FHA security instruments require a borrower to establish bona fide occupancy in a home as the borrower’s principal residence within:
60 days of the signing of the security instrument.
Loan level Price Adjustments (LLPA’s) were implemented by Fannie Mae and Freddie Mac to account for the borrower and:
loan risk characteristics.
The Cost of Funds Index (COFI) is traditionally used to determine interest rates on what type of loan?
Adjustable-Rate Mortgage (ARM)
A borrower has been approved for a loan with a 95% loan-to-value. What are the maximum contributions by an interested party allowed this borrower based on conforming lender guidelines?
3%
This ARM product offers the consumer an interest rate that is fixed for an initial period then readjusts over the remainder of the life of the loan. What is the name of these loans that are a mix of a fixed-rate period and an adjustable-rate period?
Hybrid loan
How are the FNMA/FHLMC conforming loan limits set each year?
The Federal Housing Finance Agency (FHFA) uses the October-to-October percentage increase/decrease in average housing prices, as indicated in the House Price Index report issued by the Federal Housing Finance Board (FHFB), to adjust the conforming limits for the subsequent year.
On a 3/2/6 Adjustable-Rate Mortgage loan, the 3 is the:
Initial adjustment cap.
Which loan types indicates that the borrower is obtaining a second mortgage and making a down payment?
An 80-10-10 loan
MIP is a feature of what type of mortgage loan?
An FHA loan
A borrower is a 65-year-old retiree with significant equity in his home. Which of the following would be the best option to assist him with paying for repairs on his home?
HECM
The applicant has obtained a 5-1 ARM. The index is the one-year LIBOR of 2.25%. The margin is 2.50%. The fully indexed rate and start rate are 4.75%. The caps are 3-2-6. After 5 years, the index has increased to 10.75%. What will be the borrower’s interest rate at the beginning of year 6?
(a) 13.25%
(b) 10.75%
(c) 7.75%
(d) 4.75%
What is the name of the automated underwriting system that evaluates mortgage delinquency risk and arrives at an underwriting recommendation of Approve/Eligible?
Desk Top Underwriter
VA’s debt-to-income ratio is a ratio of total monthly debts’ payments (housing expense, installment debts, etc.) to gross monthly income. It is a guide and, as an underwriting factor, it is secondary to:
the residual income method
A borrower obtains a 3/2/1 buy down on a 30-year fixed rate conforming conventional loan. The note rate is 8.00%. What will the payment interest rate be in the first year of the buy down loan?
5.00%
What is the name of a loan often referred to as the “one-time-close” or the “single-close” construction loan program?
Construction-to-Permanent Loan
