Mortgage Loan Origination Activities 2

Question 1

Under RESPA, within how many business days must a lender provide a Loan Estimate after receiving a completed loan application?

Accepted Answer

3 business days

Answer

1 business day

Answer

5 business days

Answer

7 business days

Question 2

A borrower's loan application is considered 'complete' under TRID when the lender has collected which six pieces of information?

Accepted Answer

Name, SSN, income, property address, estimated value, and loan amount

Answer

Name, DOB, employment history, assets, credit score, and loan purpose

Answer

Name, income, assets, liabilities, credit history, and property type

Answer

Name, SSN, income, property type, loan term, and interest rate preference

Question 3

Which document replaced the Good Faith Estimate (GFE) and Truth-in-Lending (TIL) disclosure for most residential mortgages starting in October 2015?

Accepted Answer

Loan Estimate

Answer

HUD-1 Settlement Statement

Answer

Closing Disclosure

Answer

Uniform Residential Loan Application

Question 4

During loan origination, what is the primary purpose of the 1003 form (Uniform Residential Loan Application)?

Accepted Answer

To collect borrower financial and property information needed to evaluate the loan

Answer

To authorize a credit pull and income verification

Answer

To disclose estimated closing costs to the borrower

Answer

To record the appraiser's determination of property value

Question 5

A mortgage loan originator (MLO) collects an upfront application fee before the borrower has received the Loan Estimate. Under TRID, this practice is:

Accepted Answer

Prohibited, except for a bona fide credit report fee

Answer

Allowed if the fee is disclosed verbally at application

Answer

Allowed for any amount the lender deems reasonable

Answer

Allowed if the borrower signs a fee agreement first

Question 6

Which of the following is an example of a 'changed circumstance' that may permit a lender to re-issue a revised Loan Estimate?

Accepted Answer

The borrower requests a different loan program after reviewing the Loan Estimate

Answer

The lender made an arithmetic error on the original estimate

Answer

The lender underestimated title fees due to internal miscalculation

Answer

Interest rates increased while the application was in processing

Question 7

Under the Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act), a state-licensed MLO must renew their license:

Accepted Answer

Annually, including completion of continuing education requirements

Answer

Every two years by passing a new NMLS exam

Answer

Every three years with a background check only

Answer

Upon each new employer change, with no time limit otherwise