FREE Mortgage Loan Originator MCQ Questions and Answers

Question 1

The SAFE Act stipulates that a mortgage loan originator must be designated as an MLO to carry out all of the following tasks, with the exception of:

Accepted Answer

Perform work related to extensions of credit for timeshare plans

Answer

Negotiate terms of a residential mortgage loan

Answer

Advise a consumer on rates, fees, and other costs

Answer

Take a residential mortgage loan application

Question 2

Except for, all of the following MLOs must possess a state license:

Accepted Answer

An MLO working for a federally insured depository institution

Answer

An MLO working as a Consumer Finance Lender (CFL)

Answer

An MLO working as a mortgage banker through the DBO

Answer

An MLO working under the authority of the Bureau of Real Estate

Question 3

Which of the following is not required to have a unique identifying number in order to act as an MLO under the SAFE Act:

Accepted Answer

None of the above

Answer

An MLO working under the authority of the DRE

Answer

An MLO working under the authority of the DBO

Answer

An employee of an insured depository institution

Question 4

Which of the following sums up evaluation the best:

Accepted Answer

An estimate of market value

Answer

Same as cost

Answer

Same as price

Answer

An estimate of value

Question 5

All of the following are listed as not requiring an MLO designation under the SAFE Act's definition of administrative and clerical work, with the exception of:

Accepted Answer

Collecting information on behalf of the consumer with regard to a residential mortgage loan

Answer

The distribution of information common for the processing or underwriting of a residential mortgage loan

Answer

Communication with a consumer to obtain information necessary for the processing and underwriting of a residential mortgage loan

Answer

The receipt and collection of information common for the processing or underwriting of a residential mortgage loan

Question 6

Every one of the following, with the exception of:

Accepted Answer

Department of Housing and Urban Development

Answer

Director of the Office of Thrift Supervision

Answer

Federal Deposit Insurance Corporation

Answer

Comptroller of the Currency

Question 7

Which of the following individuals working in the home mortgage sector would not be required to have the MLO designation in order to lawfully carry out their duties:

Accepted Answer

A loan processor performing clerical duties under the direction of a state licensed MLO.

Answer

A contract processor serving more than one MLO.

Answer

A mortgage loan originator working for Wells Fargo Bank.

Answer

A mortgage loan originator working for a credit union

Question 8

Which of the following describes the Rate-Checker?

Accepted Answer

A CFPB Owning a Home Tool that helps consumers explore interest rate options available to them.

Answer

A device which discriminates against borrowers who don’t have Internet access.

Answer

A booklet available from any lender or MLO showing the PITI monthly payment based on a specified interest rate.

Answer

Essentially a handbook of amortization tables showing monthly payments.

Question 9

Which of the following may the Rate-Checker accomplish for a borrower when used properly?

Accepted Answer

Shows the rates borrowers like them are being offered.

Answer

It incorporates information from the lenders’ external rate sheets.​

Answer

Approve or deny their loan.

Answer

Give personal advice as to whether the loan the consumer is getting is good for them.

Question 10

Where is the Rate-Checker Owning a Home Tool available?

Accepted Answer

CFPB Website

Answer

HUD Website

Answer

U.S. Government Printing Office

Answer

NMLS Resource Center