Mortgage Federal Laws and Regulations Questions and Answers

Question 1

A mortgage loan originator gives a real estate agent a $100 gift card for each referred client who closes a loan. Which federal law is being violated?

Accepted Answer

Real Estate Settlement Procedures Act (RESPA)

Answer

Truth in Lending Act (TILA)

Answer

Equal Credit Opportunity Act (ECOA)

Answer

Home Mortgage Disclosure Act (HMDA)

Question 2

Under the Equal Credit Opportunity Act (ECOA), which of the following characteristics is NOT a prohibited basis for denying credit?

Accepted Answer

Credit History

Answer

National Origin

Answer

Marital Status

Answer

Receipt of Public Assistance

Question 3

A borrower is applying for a mortgage for their primary residence. According to the Truth in Lending Act (TILA), which of the following is a key disclosure the lender must provide to the borrower within three business days of receiving the application?

Accepted Answer

The Loan Estimate

Answer

The Closing Disclosure

Answer

The Annual Escrow Statement

Answer

The Notice of Right to Rescind

Question 4

The Secure and Fair Enforcement for Mortgage Licensing (SAFE) Act requires state-licensed mortgage loan originators to complete a minimum of how many hours of pre-licensing education?

Accepted Answer

20 hours

Answer

8 hours

Answer

15 hours

Answer

25 hours

Question 5

Which of the following federal laws requires lenders to collect and report data about mortgage loan applications, including applicant demographic information, for the purpose of identifying potential discriminatory lending patterns?

Accepted Answer

Home Mortgage Disclosure Act (HMDA)

Answer

Fair Housing Act (FHA)

Answer

Gramm-Leach-Bliley Act (GLBA)

Answer

Real Estate Settlement Procedures Act (RESPA)

Question 6

A loan applicant mentions that a significant portion of their income comes from a public assistance program. According to the Equal Credit Opportunity Act (ECOA), how should the mortgage loan originator proceed?

Accepted Answer

Consider the public assistance income in the same way as any other source of income.

Answer

Disregard the public assistance income as it is not stable.

Answer

Deny the loan because public assistance is not earned income.

Answer

Tell the applicant they must find a co-signer with traditional employment.