CMB Ethics and Professional Standards in Mortgage Banking 3

Question 1

A CMB professional who receives confidential client financial information must NOT:

Accepted Answer

Disclose it to third parties for marketing or personal gain

Answer

Use the information to assess the client's loan eligibility

Answer

Share it with authorized underwriters processing the loan

Answer

Retain it in the loan file per regulatory record-keeping requirements

Question 2

Under NMLS licensing requirements, a mortgage loan originator must complete how many hours of continuing education annually to maintain licensure?

Accepted Answer

8 hours

Answer

4 hours

Answer

6 hours

Answer

12 hours

Question 3

Which of the following scenarios most clearly represents a violation of the MBA's ethical principles regarding competence?

Accepted Answer

An MLO originates a jumbo adjustable-rate mortgage without understanding its terms and pricing

Answer

An MLO refers a complex commercial deal to a colleague with commercial expertise

Answer

An MLO discloses all fees on the Loan Estimate accurately

Answer

An MLO completes required CE hours before the annual deadline

Question 4

A mortgage banker's duty to maintain confidentiality of borrower information continues:

Accepted Answer

Indefinitely, even after the business relationship ends

Answer

Only until the loan closes

Answer

Until the loan is sold to the secondary market

Answer

Until the applicable statute of limitations expires

Question 5

Under Regulation B (ECOA), a creditor who requests information about a spouse or former spouse NOT applying for joint credit is doing so improperly UNLESS:

Accepted Answer

The applicant lives in a community property state and the income is relied upon

Answer

The non-applicant spouse's income is needed to qualify

Answer

The non-applicant has a higher credit score than the applicant

Answer

The loan is a government-backed FHA or VA product

Question 6

Which of the following best defines 'predatory lending' in the context of mortgage banking ethics?

Accepted Answer

Imposing abusive terms and exploiting borrowers through deceptive or coercive practices for the lender's gain

Answer

Offering mortgage products with rates above the prime rate

Answer

Charging origination fees that exceed 1% of the loan amount

Answer

Requiring escrow accounts for property taxes and insurance

Question 7

A CMB professional who suspects a colleague of mortgage fraud is ethically required to:

Accepted Answer

Report the suspected fraud through appropriate internal or regulatory channels

Answer

Confront the colleague privately and allow them to self-correct

Answer

Ignore it if the suspicious activity does not involve their own clients

Answer

Wait until the transaction is complete before taking any action