CRU Regulatory Framework & Compliance 2

Question 1

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

Accepted Answer

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

Answer

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

Question 2

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

Accepted Answer

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

Answer

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

Question 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:

Accepted Answer

Redlining

Answer

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

Question 4

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

Accepted Answer

3 years

Answer

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

Question 5

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

Accepted Answer

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

Answer

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

(CRU) Certified Residential Underwriter Practice Test

(CRU) Certified Residential Underwriter Practice Test

CRU Regulatory Framework & Compliance 2