Uniform State Content Flashcards
7 cards from real Mortgage practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Uniform State Content flashcards as text
A borrower applies for a mortgage and is denied. The lender must provide a written adverse action notice that includes which of the following?
Answer: The specific reasons for denial or notice of the right to request those reasons
ECOA and the Fair Credit Reporting Act require that adverse action notices state specific reasons for denial or inform the applicant of their right to request those reasons.
Under the NMLS system, an MLO license can be transferred to a new employer through which process?
Answer: The MLO submits a sponsorship request through NMLS and the new employer approves it
An MLO transfers their license through the NMLS by requesting sponsorship from their new employer, who then approves the association.
Which type of loan is generally exempt from the Home Mortgage Disclosure Act (HMDA) reporting requirements?
Answer: A business-purpose loan secured by a commercial property
HMDA reporting covers loans for home purchase, home improvement, and refinancing on dwelling-secured loans; business-purpose loans on commercial properties are generally excluded.
A lender charges a borrower a fee for paying off their mortgage early. Under federal law, which loan type restriction applies to prepayment penalties?
Answer: Prepayment penalties on higher-priced mortgage loans are restricted under Regulation Z
Regulation Z restricts prepayment penalties on higher-priced mortgage loans and prohibits them entirely on most qualified mortgages after three years.
Under the SAFE Act, the term 'nontraditional mortgage product' includes which of the following?
Answer: An interest-only loan or a payment-option adjustable-rate mortgage
Nontraditional mortgage products include interest-only loans and payment-option ARMs because they defer principal repayment and carry higher risk of payment shock.
Which agency is primarily responsible for enforcing the Truth in Lending Act for non-bank mortgage lenders?
Answer: Consumer Financial Protection Bureau (CFPB)
The CFPB has primary enforcement authority over TILA for non-bank mortgage lenders and other consumer financial products.
An MLO collects a $400 application fee from a borrower at the time of application. Under which circumstance may the lender retain this fee if the loan does not close?
Answer: If the fee is for a bona fide third-party service already performed, such as a credit report or appraisal
Lenders may retain fees for bona fide third-party services actually rendered (e.g., appraisals, credit reports) even if the loan does not close.