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Federal Regulations and Compliance Standards Flashcards

7 cards from real CMC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Federal Regulations and Compliance Standards flashcards as text

  1. Under the Fair Housing Act, which of the following is NOT a protected class at the federal level?

    Answer: Sexual orientation

    Sexual orientation is not a federally protected class under the Fair Housing Act, though many states and localities have added it independently.

  2. A lender's policy of refusing to make loans in certain geographic areas regardless of applicants' creditworthiness is known as:

    Answer: Redlining

    Redlining is the discriminatory practice of denying services to residents of specific areas based on the racial or ethnic composition of those neighborhoods.

  3. Under Regulation Z, the rescission period for a refinance of a primary residence allows the borrower to cancel the loan within:

    Answer: 3 business days from closing, delivery of the notice, or delivery of all material disclosures

    Regulation Z grants a 3-business-day right of rescission measured from the latest of closing, delivery of the rescission notice, or delivery of required disclosures.

  4. The SAFE Act requires all mortgage loan originators (MLOs) to:

    Answer: Register with or be licensed through the Nationwide Multistate Licensing System (NMLS)

    The SAFE Act mandates that MLOs register with depository institutions or obtain state licensure, both recorded in the NMLS.

  5. Which regulation implements the Equal Credit Opportunity Act (ECOA) and prohibits discrimination in credit transactions?

    Answer: Regulation B

    Regulation B implements ECOA and requires creditors to evaluate applicants without regard to race, sex, age, religion, national origin, or receipt of public assistance.

  6. Under TRID rules, which event allows a lender to issue a revised Loan Estimate reflecting higher closing costs?

    Answer: A valid changed circumstance such as a natural disaster affecting the property

    Revised Loan Estimates are permitted only when valid changed circumstances occur, such as acts of God, borrower-requested changes, or new information about the borrower or property.

  7. The Dodd-Frank Wall Street Reform Act created which agency primarily responsible for enforcing federal consumer financial protection laws including mortgage regulations?

    Answer: Consumer Financial Protection Bureau (CFPB)

    Dodd-Frank created the CFPB in 2010 as a standalone agency to oversee consumer financial products including mortgages, credit cards, and student loans.