Mortgage Cheat Sheet 2026

The 30 highest-yield Mortgage facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. A mortgage company's marketing materials guarantee the lowest rate in the market without any conditions. This practice is: → A violation of truth-in-advertising and TILA requirements
2. Which of the following costs is typically NOT paid by the borrower at closing? → The seller's real estate commission
3. What is the purpose of the initial escrow deposit collected at closing? → To fund the reserve account for future property tax and insurance payments
4. A mortgage professional discovers that a colleague has been backdating documents to meet a program deadline. What is the most appropriate course of action? → Report the conduct to their compliance department or supervisor
5. The Fair Housing Act prohibits mortgage lending discrimination based on all of the following EXCEPT which? → Credit history
6. Under the SAFE Act, what is required of all mortgage loan originators? → Registration through the Nationwide Multistate Licensing System (NMLS)
7. What is an 'air loan' in mortgage fraud? → A loan for a property that does not exist or a borrower who does not exist
8. Which federal law requires mortgage servicers to provide borrowers with an annual escrow account statement? → Real Estate Settlement Procedures Act (RESPA)
9. An MLO applicant has a felony conviction from 9 years ago involving fraud. Under the SAFE Act, what is the status of their application? → Automatically denied due to the felony involving fraud
10. If a borrower is obtaining a mortgage on a property located in a different state than their primary residence, which state's Uniform State Content applies? → The state where the subject property is located
11. The Homeowners Protection Act (HPA) of 1998 primarily addresses which borrower concern? → Automatic termination of private mortgage insurance (PMI)
12. A seller secretly provides the buyer's down payment through an inflated purchase price, concealing this from the lender. What type of fraud is this? → Down payment fraud involving a silent kickback
13. How long is the mandatory waiting period after receiving the Closing Disclosure before a borrower can sign closing documents? → 3 business days
14. What provision of the Dodd-Frank Act required mortgage lenders to verify a borrower's ability to repay the loan? → Ability-to-Repay rule
15. Which of the following activities would require an individual to be licensed as an MLO under the SAFE Act? → Taking a residential mortgage loan application and offering loan terms
16. Under the Dodd-Frank Act, what is the maximum debt-to-income ratio generally permitted for a Qualified Mortgage (QM)? → 43%
17. What is the maximum timeframe a lender has to provide a Loan Estimate after receiving a mortgage application under TRID rules? → 3 business days
18. Under the Equal Credit Opportunity Act (ECOA), which factor may a lender legally consider when evaluating a mortgage application? → Applicant's credit history
19. What is the primary purpose of the initial disclosure package provided during mortgage loan origination? → To inform the borrower of estimated loan costs, terms, and their legal rights
20. Which federal law requires lenders to disclose the Annual Percentage Rate (APR) to borrowers? → Truth in Lending Act (TILA)
21. What kind of financial inducement prompted so many foreclosures? → The home is worth less than the amount of the mortgage.
22. What is the typical minimum credit score required for a conventional mortgage loan? → 620
23. Which of the following would most likely cause a mortgage application to be sent back to the borrower for additional documentation during processing? → A large unexplained deposit appears in the borrower's bank statements
24. What does 'debt-to-income ratio' (DTI) represent to a mortgage lender? → The ratio of the borrower's total monthly debt payments to gross monthly income
25. The HUD-1 Settlement Statement was replaced by which document under the TRID rule? → Closing Disclosure
26. An underwriter discovers that a borrower's credit report shows a recent collection account. What is the most appropriate next step? → Request a letter of explanation from the borrower
27. Which document is used to verify a borrower's income from self-employment during underwriting? → Tax returns with Schedule C or K-1
28. Which scenario best illustrates a conflict of interest in mortgage lending? → An appraiser inflates a property value at the request of the loan officer who hired them
29. Under the Real Estate Settlement Procedures Act (RESPA), which of the following is prohibited? → Accepting kickbacks for referrals of settlement services
30. A mortgage loan originator receives a referral fee from a real estate agent for directing borrowers to their services. Under RESPA, this arrangement is: → Prohibited as an illegal kickback