Mortgage Uniform State Content 5

Question 1

Which federal act established the Consumer Financial Protection Bureau (CFPB)?

Accepted Answer

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010

Answer

The Dodd-Frank Act of 2010 created the CFPB to consolidate consumer financial protection authority previously spread across multiple federal agencies.

Question 2

A mortgage loan originator receives a gift card from a title company after closing several loans with them. Under RESPA, this arrangement is:

Accepted Answer

Prohibited as an unearned fee or kickback under Section 8

Answer

RESPA Section 8 prohibits any fee, kickback, or thing of value exchanged for referrals of settlement service business, regardless of dollar amount.

Question 3

Under the SAFE Act's continuing education requirements, a licensed MLO must complete how many hours of continuing education annually?

Accepted Answer

8 hours

Answer

The SAFE Act requires MLOs to complete a minimum of 8 hours of approved continuing education each year to maintain their license.

Question 4

Which of the following loan features characterizes a 'balloon payment mortgage'?

Accepted Answer

A large lump-sum payment is due at the end of the loan term

Answer

A balloon payment mortgage requires a large final payment at the end of the term, often after a period of smaller regular payments.

Question 5

Under the Home Mortgage Disclosure Act (HMDA), what is the primary purpose of collecting and reporting loan data?

Accepted Answer

To help identify discriminatory lending patterns and determine whether lenders are serving their communities' housing needs

Answer

HMDA data is used by regulators and the public to identify discriminatory lending practices and assess whether financial institutions are meeting community credit needs.

Mortgage Practice Test

Mortgage Practice Test

Mortgage Uniform State Content 5