FREE Mortgage Loan Originator Assessment Questions and Answers
Which of the following techniques can be used to deliver the Closing Disclosure on time?
The CD is deemed to have been delivered personally on the day it is made available. It must be received within three (3) business days, whether by USPS or email.
Regarding a blanket mortgage, all of the following are true, with the exception of:
It is a partial release clause, so as the note is paid down, some of the lots may be freed.
Regarding a debt that has partially amortized, all of the following are true, with the exception of:
"A partially amortized loan is a self-liquidating loan" is not true regarding a partially amortized loan.
A partially amortized loan is a type of loan where regular payments are made over the loan term, but those payments are not sufficient to fully repay the loan by the end of the term. As a result, there is a remaining balance, or "balloon payment," that is due at the end of the loan term.
A variable balance mortgage's interest rate fluctuates (VBM). What remains constant?
The payment does not alter when the interest rate on a VBM changes. Instead, the loan's balance alters.
An open-end loan is which of the following?
As a result, the loan sum may increase without requiring a revision of the loan documentation, and the line of credit may be accessed as needed.
Which of the following statements about a straight-term mortgage is true?
"No principal payments are being made" is the best description of a straight-term mortgage.
A straight-term mortgage, also known as an interest-only mortgage, is a type of mortgage where the borrower makes regular payments that only cover the interest accrued on the loan. Unlike a traditional amortizing mortgage, where each payment includes both principal and interest, in a straight-term mortgage, the borrower is not making any payments toward reducing the loan's principal balance.
How long does it take to pay off a bridge loan?
When a property owner sells one property and purchases another, they take out a bridge loan, or swing loan as we say in California. Money is required to proceed with the acquisition of the second property even though the first property has not yet been sold. The bridge loan serves as a temporary loan for that purpose, and it can be repaid after finance for the purchase of the second home has been secured.
Regarding a building loan, every statement is accurate, with the exception of:
The take-out loan, which typically lasts 30 years, replaces the construction loan.
Which of the following loans would have likely been provided in the past to someone looking to purchase a home but with less-than-perfect credit?
These loans might have required a statement of income, could not be categorized as conforming loans, and were most likely subprime loans. Such a loan might be made by some lenders, although it's harder to get one now.
Which of the following has an open-end mortgage the most likely:
These business owners require a consistent cash flow to cover their continuous expenses. A is significantly more likely to win you a point than B, except perhaps for gamblers.
Which of the following statements about a cash-out mortgage is accurate:
A cash-out mortgage can meet all of these requirements.
Which statement about a permanent construction loan is accurate:
Contrarily, a take-out loan is used in place of a construction loan, which is known as an interim loan (short-term or temporary).
Regarding the Closing Disclosure, all of the following are accurate with the exception of:
The creditor always retains complete responsibility for the Closing Disclosure's accuracy and timely delivery, even if the settlement agent assisted in its preparation.
Which of the following would determine whether easy-qualifier loans were available:
Such a loan could not be sold on the secondary market under current restrictions.
Which of the following statements most accurately reflects mandatory advances for construction loans:
Lenders have discovered that deferring the whole amount of a construction loan to the builder increases the likelihood that the project will be finished.
Which of the following best describes how a home equity loan and a home equity line of credit are different:
The distinction between a HELOC and a home equity loan is only made in this sentence.