NMLS Quiz #2

In 2008, the Housing and Economic Recovery Act (HERA) initiated a subsequent act that required states to standardize the license and application process for mortgage loan originators to ensure greater consumer protection. What was this act called?

• Dodd-Frank Act

• Patriot Act

• SAFE Act

• HERA

The Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators are responsible for:

• Writing HERA and enforcing all the federal mortgage laws

• Writing the SAFE act and maintaining the NMLS

• Creating the CFPB and maintaining the NMLS

• Writing the conforming guidelines and purchasing loans from the primary market

Which of the following does a Mortgage Loan Originator (MLO) not do?

• Take a 1003 application

• Negotiate rates and fees of the loan

• Assist a customer in applying for a residential mortgage loan

• Perform judgment on the loan file

The primary purpose of Fannie Mae and Freddie Mac is to:

• Develop industry guidelines

• Purchase loans from the secondary market

• Regulate the premiums with the interest market

• Purchase loans from the primary market

SAFE Pre-licensing education is broken down by:

• 8 hours with 3 hours Federal Law, 3 hours Ethics, 2 hours Non-Traditional Lending, 1 hour elective

• 10 hours with 3 hours Federal Law, 3 hours Ethics, 3 hours Non-Traditional Lending, 1 hour elective

• 20 hours with 3 hours Federal Law, 3 hours Ethics, 2 hours Non-Traditional Lending, 12 hours electives

• 20 hours with 3 hours Federal Law, 2 hours Ethics, 3 hours Non-Traditional Lending, 12 hours general mortgage knowledge

SAFE continuing education is broken down by:

• 8 hours with 2 hours Federal Law, 3 hours Ethics, 2 hours Non-Traditional Lending, 1 hour elective

• 8 hours with 3 hours Federal Law, 2 hours Ethics, 2 hours Non-Traditional Lending, 1 hour elective

• 5 hours with 3 hours Federal Law, 1 hour Ethics, 1 hour Non-Traditional Lending, 1 hour elective

• 12 hours with 3 hours Federal Law, 2 hours Ethics, 2 hours Non-Traditional Lending, 5 hours general mortgage knowledge

A registered MLO works for what types of institutions:

• Depository institution such as a correspondent lender

• State licensed lender such as a credit union

• Depository institution such as a bank

• Subsidiary of a mortgage lender such as a broker

The maximum length of a prepayment penalty allowed is:

• 6 months from the start of the loan

• 1 year from the start of the loan

• 2 years from the start of the loan

• 3 years from the start of the loan

The maximum amount of penalty that can be charged for a prepayment penalty is:

• 6 months of interest

• 1% of the remaining loan balance

• 2% of the remaining loan balance

• 2% of the original loan balance

What is the clause on a note that allows a lender to call a loan due prior to the scheduled amortization date if the borrower defaults on the payments?

• Non-recourse clause

• Due-on-sale clause

• Re-conveyance clause

• Acceleration clause