Practice Test Geeks(CRU) Certified Residential Underwriter Practice Test
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Regulatory Framework & Compliance Flashcards

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

Read the first 7 Regulatory Framework & Compliance flashcards as text

  1. Under RESPA, which of the following is considered a prohibited kickback arrangement?

    Answer: A lender paying a referral fee to a real estate agent for sending mortgage business

    RESPA Section 8 prohibits any fee, kickback, or thing of value exchanged for referrals of settlement service business.

  2. Which federal agency has primary supervisory authority over federally chartered savings associations for mortgage lending compliance?

    Answer: Office of Thrift Supervision (now OTS functions absorbed by OCC)

    The OTS historically supervised federal savings associations, and after Dodd-Frank its functions were transferred to the OCC.

  3. A lender's policy of requiring higher down payments in neighborhoods with predominantly minority residents, without a legitimate credit-related justification, is an example of:

    Answer: Redlining

    Redlining is the discriminatory practice of denying or limiting financial services to specific geographic areas based on their racial or ethnic composition.

  4. Under the Dodd-Frank Act, what is the maximum prepayment penalty period allowed for a Qualified Mortgage?

    Answer: 3 years

    QM rules prohibit prepayment penalties beyond 3 years after consummation of the loan.

  5. Which of the following best describes the purpose of the Homeowners Protection Act (HPA)?

    Answer: Mandating automatic cancellation of PMI when a borrower reaches 20% equity

    The HPA requires lenders to automatically cancel PMI when the borrower's LTV reaches 78% of the original purchase price.

  6. Under the Community Reinvestment Act (CRA), banks are evaluated on their performance in serving low- and moderate-income communities in which of the following areas?

    Answer: Lending, investment, and service

    CRA evaluations assess banks across three performance tests: lending, investment, and service to LMI communities.

  7. A borrower applies for a mortgage and the underwriter discovers the borrower previously filed bankruptcy that was discharged 2 years ago. Under FHA guidelines, how many years must typically elapse after a Chapter 7 discharge before the borrower is eligible?

    Answer: 2 years

    FHA guidelines generally require a minimum 2-year waiting period after a Chapter 7 bankruptcy discharge before a borrower can obtain FHA financing.