Mortgage Loan Originator Federal Regulations and Ethics 2

Question 1

Under the Dodd-Frank Act, a 'Qualified Mortgage' (QM) provides lenders with:

Accepted Answer

A presumption of compliance with the ability-to-repay rule

Answer

A QM provides either a safe harbor (for lower-priced QMs) or a rebuttable presumption (for higher-priced QMs) that the lender satisfied the ability-to-repay (ATR) requirement.

Question 2

Which federal law requires lenders to inform applicants of the action taken on their credit application within 30 days?

Accepted Answer

ECOA

Answer

ECOA requires creditors to notify applicants of adverse action within 30 days of receiving a completed application, or 30 days after taking the adverse action.

Question 3

Under the CAN-SPAM Act, electronic marketing communications from MLOs must include:

Accepted Answer

A clear opt-out mechanism and the sender's physical postal address

Answer

CAN-SPAM requires commercial emails to include a functioning opt-out mechanism and a valid physical postal address for the sender.

Question 4

The Gramm-Leach-Bliley Act (GLBA) requires financial institutions to:

Accepted Answer

Provide privacy notices and safeguard consumer financial information

Answer

GLBA requires financial institutions to notify consumers about their information-sharing practices and implement security measures to protect nonpublic personal information.

Question 5

An MLO who accepts a gift valued over $50 from a settlement service provider in exchange for referrals may be violating:

Accepted Answer

RESPA Section 8

Answer

RESPA Section 8 prohibits giving or receiving anything of value as a referral fee, making referral-based gifts a clear violation regardless of dollar amount.

Mortgage Loan Originator Practice Test

Mortgage Loan Originator Practice Test

Mortgage Loan Originator Federal Regulations and Ethics 2