Mortgage Regulations and Compliance Flashcards
7 cards from real CMA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Mortgage Regulations and Compliance flashcards as text
Under the Ability-to-Repay (ATR) rule, which of the following is NOT one of the eight factors lenders must consider?
Answer: The borrower's intended use of loan proceeds
The ATR rule's eight factors include income, assets, employment, credit history, monthly payment, other debt obligations, debt-to-income ratio, and simultaneous loans — not intended use.
A Qualified Mortgage (QM) under the General QM definition caps the debt-to-income ratio at:
Answer: 43%
The original General QM definition set a 43% DTI ceiling; however, the 2021 General QM rule replaced the DTI limit with a price-based limit (APR vs. APOR spread).
Which provision of the Dodd-Frank Act created the Consumer Financial Protection Bureau?
Answer: Title X
Title X of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 established the CFPB.
Under TRID, the Loan Estimate must be delivered to the applicant within how many business days of receiving a complete application?
Answer: 3 business days
Lenders must deliver or mail the Loan Estimate within 3 business days of receiving the consumer's application.
The SAFE Act requires mortgage loan originators to complete how many hours of pre-licensure education before obtaining a state license?
Answer: 20 hours
The SAFE Mortgage Licensing Act mandates a minimum of 20 hours of NMLS-approved pre-licensure education for state-licensed MLOs.
Under ECOA and Regulation B, a lender must notify an applicant of a credit decision within how many days for a mortgage application?
Answer: 30 days
ECOA requires lenders to notify applicants of action taken on a mortgage application within 30 days of receiving a completed application.
A lender charges a higher interest rate to a borrower because the property is located in a flood zone. Under fair lending laws, this practice is:
Answer: Permitted as a legitimate risk-based factor
Pricing based on objective property risk factors like flood zone designation is a legitimate, non-discriminatory business practice under fair lending laws.