Practice Test Geeks(NMLS) National Mortgage Licensing System Practice Test
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Federal Mortgage-Related Laws Flashcards

7 cards from real NMLS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Federal Mortgage-Related Laws flashcards as text

  1. Under the Homeowners Protection Act, at what point may a borrower request cancellation of private mortgage insurance on a conventional loan?

    Answer: When the LTV reaches 80% of original value

    A borrower may request PMI cancellation once the balance reaches 80% of the home's original value, with automatic termination at 78% on the amortization schedule.

  2. Under ECOA and Regulation B, within how many days after receiving a completed application must a creditor notify the applicant of action taken?

    Answer: 30 days

    Regulation B requires notification of action taken within 30 days of receiving a completed application.

  3. The Flood Disaster Protection Act requires flood insurance on a federally regulated loan when the property is located in:

    Answer: A Special Flood Hazard Area in a participating community

    Flood insurance is mandatory for loans from regulated lenders secured by improved property in a Special Flood Hazard Area of a community participating in the NFIP.

  4. A borrower refinances a loan secured by their principal dwelling with a new lender. Under TILA, how long is the standard right of rescission?

    Answer: Until midnight of the third business day after consummation

    TILA gives three business days after consummation, delivery of rescission notice, or required disclosures, whichever is latest.

  5. Which RESPA provision prohibits giving or accepting kickbacks and unearned fees for referrals of settlement service business?

    Answer: Section 8

    RESPA Section 8 prohibits kickbacks, referral fees, and unearned fee splitting in settlement services.

  6. Under the Servicemembers Civil Relief Act, what is the maximum interest rate on a pre-service mortgage obligation for a servicemember on active duty, upon proper request?

    Answer: 6%

    The SCRA caps interest on obligations incurred before active duty at 6% during military service.

  7. Under the GLBA Privacy Rule, when must a lender give a customer its initial privacy notice?

    Answer: No later than when the customer relationship is established

    The initial privacy notice must be delivered no later than when the customer relationship is established, generally at consummation.

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