2. The Fair Housing Act requires lenders to display what in all branch offices? 3. Which is LEAST LIKLEY to be an indicator of predatory lending?

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1 Course: Lesson: National Mortgage Loan Originator Review Crammer (ml) Ethics 1. At closing, buyer Steve sees that the lender changed the terms of the loan that they had agreed to, but he felt he had no choice but to go ahead with the loan or lose the chance to buy the house. This could be an example of A. affinity marketing. B. loan flipping. C. negative amortization. D. predatory lending. 2. The Fair Housing Act requires lenders to display what in all branch offices? A. a business brochure B. the Equal Housing Lender Poster C. a list of rights under the Fair Housing Act D. a summary of the Fair Housing Act 3. Which is LEAST LIKLEY to be an indicator of predatory lending? A. charging excessive prepayment penalties B. falsifying loan documents C. increasing interest charges on late loan payments D. requiring mortgage insurance 4. Which is an example of steering? A. Agent Tom tells homeowners that their property values will drop when a Puerto Rican family moves in. B. Mortgage banker Brad refuses to make loans for a particular inner city neighborhood. C. Property manager Amy suggests Jake would be happier in a more diverse building. D. Seller Oscar tells his listing agent to find only Caucasian buyer prospects. 5. The Privacy Rule requires that financial institutions provide the consumer with a Consumer Privacy Policy disclosure

This could be an example of A. affinity marketing. B. loan flipping. C. negative amortization. D. predatory lending. 2. The Fair Housing Act requires lenders to display what in all branch offices? A. a business brochure B.

2 A. annually as long as the relationship continues. B. at closing only. C. each time the policy is revised. Course: Lesson: D. each time the servicing is transferred. National Mortgage Loan Originator Review Crammer (ml) Ethics 6. A consumer calls to ask about a loan product. How does TILA require you to quote an interest rate to him? A. the annual percentage rate only B. the APR as well as the interest rate C. the interest rate only D. TILA does not address the quoting of interest rates. 7. Mortgage broker Dave knew that his customer worked at a factory that was two weeks away from closing, but in his eagerness to close the deal, he decided to ignore that fact. This might be considered an example of A. actual fraud. B. constructive fraud. C. good business. D. negligent misrepresentation. 8. What word best describes a group of participants working together to commit single acts of mortgage fraud? A. collusion B. discernment C. omission D. representation 9. In a fraud for property scheme, it is likely that A. the borrower doesn t intend to repay the loan. B. the borrower seeks ownership.

the APR as well as the interest rate C. the interest rate only D. TILA does not address the quoting of interest rates. 7.

3 C. a group of individuals is colluding to gain from the scheme. D. illegal property flipping occurs. 10. Mortgage broker Dave works with his appraiser friend to get an inflated value on a house. He then recruits his cousin Bob, who has great credit, to apply for a mortgage on the property, even though Bob is moving to Belize and has no intention of paying off the loan. In this case, Bob could be considered a buyer. A. colluded B. forged C. mock Course: Lesson: D. straw National Mortgage Loan Originator Review Crammer (ml) Ethics 11. Loan officer Sarah knows that the customer sitting across from her will not qualify for a loan, so she tells him to not waste his time applying. Sarah has violated what law? A. CRA B. ECOA C. HMDA D. TILA 12. Which type of loan was most likely to be part of a mortgage fraud scheme? A. adjustable rate mortgage B. budget mortgage C. FHA loan D. no-doc 13. What type of scam entails homeowners who are encouraged to refinance their property over and over until little or no equity remains? A. extreme lending B. loan flipping C. property skimming D. reverse equity

In this case, Bob could be considered a buyer. A. colluded B. forged C. mock Course: Lesson: D. straw National Mortgage Loan Originator Review Crammer (ml) Ethics 11.

4 14. What is NOT protected by the Fair Housing Act? A. disability B. familial status C. national origin D. receipt of income from a public source 15. When an appraiser gives a loan officer what s needed on the appraisal report, the consumer usually ends up A. borrowing too much on the property. B. not being able to sell the property. C. paying more discount points at closing. D. refinancing the property. Course: National Mortgage Loan Originator Review Crammer (ml) Lesson: Ethics

When an appraiser gives a loan officer what s needed on the appraisal report, the consumer usually ends up A.

5 You have not successfully completed the exam Score Required: 75 Exam Score: 27 Attempt: 36 of Unlimited X 1. At closing, buyer Steve sees that the lender changed the terms of the loan that they had agreed to, but he felt he had no choice but to go ahead with the loan or lose the chance to buy the house. This could be an example of A. affinity marketing. D. predatory lending. This could be an example of predatory lending. [R433] X 2. The Fair Housing Act requires lenders to display what in all branch offices? A. a business brochure B. the Equal Housing Lender Poster The Equal Housing Opportunity Act requires only the displaying of the Equal Housing Lender Poster, which indicates to the public that the lender is governed by the Fair Housing Act. There is no requirement that the advertising for that lender be displayed in the branch office. [R460] X 3. Which is LEAST LIKLEY to be an indicator of predatory lending? X 4. Which is an example of steering? A. charging excessive prepayment penalties D. requiring mortgage insurance Requiring mortgage insurance does not indicate predatory lending. [R488] A. Agent Tom tells homeowners that their property values will drop when a Puerto Rican family moves in. C. Property manager Amy suggests Jake would be happier in a more diverse building. Steering relates to buyers or renters and is defined as channeling prospective buyers or renters to or away from specific neighborhoods. [R486] 5. The Privacy Rule requires that financial institutions provide the consumer with a Consumer Privacy Policy disclosure A. annually as long as the relationship continues. A. annually as long as the relationship continues. According to the Gramm-Leach-Bliley Act, this disclosure is required to be provided annually as long as the relationship continues. [R466]

This could be an example of A. affinity marketing. D. predatory lending. This could be an example of predatory lending. [R433] X 2.

6 X 6. A consumer calls to ask about a loan product. How does TILA require you to quote an interest rate to him? A. the annual percentage rate only B. the APR as well as the interest rate TILA law requires that the APR be quoted along with the interest rate. [R427] 7. Mortgage broker Dave knew that his customer worked at a factory that was two weeks away from closing, but in his eagerness to close the deal, he decided to ignore that fact. This might be considered an example of A. actual fraud. A. actual fraud. If Dave made the decision to ignore a critical fact, he could be accused of actual fraud. [R452] 8. What word best describes a group of participants working together to commit single acts of mortgage fraud? A. collusion A. collusion X 9. In a fraud for property scheme, it is likely that Collusion is when a group of participants for example, appraisers, title companies, real estate agents, mortgage brokers or lenders, or even lawyers all work together to commit single acts of fraud. [R481] A. the borrower doesn t intend to repay the loan. B. the borrower seeks ownership. In fraud for property, it is likely that the only perpetrator is the borrower who seeks housing and/or cash from the loan. In addition, this fraud involves a single loan in which the borrower intends to repay. [R444] X 10. Mortgage broker Dave works with his appraiser friend to get an inflated value on a house. He then recruits his cousin Bob, who has great credit, to apply for a mortgage on the property, even though Bob is moving to Belize and has no intention of paying off the loan. In this case, Bob could be considered a buyer. A. colluded D. straw Mortgage insiders commit mortgage fraud when they knowingly make loans to unqualified buyers, or straw buyers, who will never make a payment on the loan. [R453] X 11. Loan officer Sarah knows that the customer sitting across from her will not qualify for a loan, so she tells him to not waste his time applying. Sarah has violated what law?

Mortgage broker Dave knew that his customer worked at a factory that was two weeks away from closing, but in his eagerness to close the deal, he decided to ignore that fact.

7 A. CRA B. ECOA Under the Equal Credit Opportunity Act, no borrower may be discouraged from making a formal loan application. The borrower is entitled to the same process as one with high income and credit scores. [R449] X 12. Which type of loan was most likely to be part of a mortgage fraud scheme? A. adjustable rate mortgage D. no-doc A no-doc loan allowed the borrower to simply indicate their income, assets, and debt without documentation or verification. This practice led to many instances of mortgage fraud. [R499] X 13. What type of scam entails homeowners who are encouraged to refinance their property over and over until little or no equity remains? A. extreme lending B. loan flipping X 14. What is NOT protected by the Fair Housing Act? In a loan flipping scam a type of equity skimming homeowners are encouraged to keep refinancing their property. Each time they refinance, they are charged points and closing costs, along with other fees. And each time, the equity gets smaller. [R480] A. disability D. receipt of income from a public source Receipt of income from a public source is covered by ECOA, but is not mentioned in the Fair Housing Act. [R478] 15. When an appraiser gives a loan officer what s needed on the appraisal report, the consumer usually ends up A. borrowing too much on the property. A. borrowing too much on the property. The cooperation between the appraiser and the loan officer in giving what s needed on the appraisal report leads to the consumer borrowing too much, resulting in an upside-down loan. [R482] Back

adjustable rate mortgage D. no-doc A no-doc loan allowed the borrower to simply indicate their income, assets, and debt without documentation or verification.

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How To Understand The Law Of The Landline Phone Mortgage Lending P&P 100-Question Final Exam Answer Key 1. C 2. B 3. A 4. B 5. A 6. C 7. C 8. C 9. D 10. C 11. D 12. B 13. D 14. A 15. D 16. D 17. B 18. D 19. A 20. C 21. D 22. D 23. B 24. D 25. A 26.