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Chapter 1 and 2 MEC

Total questions: 61

Worksheet time: 39mins

Name
Class
Date
1.

SAFE act

a)

Secure/ Fair Enforcement for Mortgage Licensing Act

b)

Secure and Fair Enforcement for Mortgage Licensing Act

c)

Secure and Fair Enforce for Mortgage Licensing Act

2.

SAFE act

a)

Federal law

b)

State law

c)

Global law

d)

National law

3.

SAFE act

a)

prohibits deceptive acts

b)

Prohibited conduct

4.

Prohibited conduct

a)

can't charge a fee for best efforts

b)

Misleading

5.

Dodd-Frank Act

a)

UDAAP

b)

TRID

c)

CFPB

d)

RESPA

6.

Dodd-Frank Act

a)

prohibits deceptive acts

b)

Prohibited conduct

7.

Mortgage broker

a)

don't fund own loan

b)

Larger company

c)

company or firm

d)

Limited programs

8.

Mortgage broker

a)

sell it to secondary market

b)

hand over to mortgage lender

c)

does not hand over to mortgage lender

d)

can do start to finish on applications

9.

Mortgage broker

a)

Primary market

b)

variety of programs

c)

Limited programs

d)

Sell it to secondary market

10.

Mortgage lender

a)

limited programs

b)

Variety of programs

c)

don’t fund own loan

d)

sell it to secondary market

11.

Mortgage lender

a)

could be primary market until selling the loan

b)

larger company's

c)

Primary market

d)

can do start to finish on applications

12.

Secondary market

a)

Fannie Mae

b)

Large banks

c)

Ginnie Mae

d)

Freddie Mac

13.

Corresponding lender

a)

go trough whole process than immediately sell the loan to secondary market

b)

go trough whole process than keep the loan

c)

go trough whole process than immediately sell the loan to another mortage brokerage

14.

Mortgage servicer

a)

collect payments

b)

manage escrow accounts

c)

Negotiate loans

d)

Sell to secondary market

15.

Mortgage backed security(mbs)

a)

for investors to buy and sell

b)

Manage escrow accounts

c)

Negotiations on loans

d)

Investigate mortgage brokers

16.

secondary market

a)

mortgage loan life cycle

b)

only purchase conventional loans

c)

Successive year

d)

Purchase all loans

17.

Ginnie government loans

a)

FHA

b)

VA

c)

USDA

d)

Non Conventional

18.

Regulatory authority

a)

Provide supervision

b)

Enforce the law

c)

Restrict your license in all states

d)

power to investigate impose penalties

19.

Federal Banking Agency

a)

national credit union administration (ncua)

b)

Mortgage backed security(mbs)

c)

federal deposit insurance corporation (fdic)

d)

office of the comptroller of currency (occ)

20.

NCUA

a)

National Credit Union Administration

b)

Nation Credit Union Administration

c)

National Credit Union Administrator

21.

FDIC

a)

Federal Depository Insurance Corporation

b)

Federal Deposit Insurance Corporate

c)

Federal Deposit Insurance Corporation

22.

OCC

a)

Office of the Comp of the Currency

b)

Office of the Comptroller of the Currency

c)

Office of the Comptroller

23.

MU4

a)

form for application

b)

Form for loan

24.

Getting a license

a)

bankruptcy doesn't disqualify but need explanation.

b)

bankruptcy does disqualify

c)

bankruptcy doesn't disqualify

25.

Temporary authority

a)

registered MLO

b)

Can get compensated on any loan

c)

Not registered MLO

d)

can't get compensated on any loans

26.

Model law

a)

Most states have

b)

All states have

27.

Fixed rate mortgage payment will change if

a)

borrower taxes

b)

Mortgage insurance removed

c)

Insurance change

d)

Income change

28.

Escrow or impound

a)

money deposited with a mortgage broker

b)

money deposited with a third party

29.

money deposited with a third party

a)

fire insurance

b)

Taxes

c)

Homeowner association

d)

Flood insurance

30.

Adjustable rate mortgage (ARM)

a)

variable rate mortgage

b)

Fixed rate mortgage

31.

PITI

a)

Principle

b)

Interest

c)

Taxes

d)

Insurance

32.

Adjustable rate mortgage (ARM)

a)

margine is set amount of profit

b)

index will change

c)

margine is not set amount of profit

d)

Index will not change

33.

margine is set amount of profit

a)

It is controlled

b)

It is not controlled

34.

Adjustable rate mortgage (ARM)

a)

Interest only arm

b)

adjustment period

c)

Payment option arm

d)

Hybrid arm

35.

Adjustable rate mortgage (ARM)

a)

Most common

b)

interest can go up or down

c)

second most common product

36.

Index and margin

a)

Determined integrate rate

b)

Indexed rate

c)

Fully indexed rate

37.

Index

a)

measure of market rate

b)

Measure of margin

38.

Index most common

a)

(SOFR) secured overnight financing rate

b)

Adjustable rate mortgage (ARM)

c)

(CMT) constant maturity treasury

39.

ARM cap at the first phase

a)

decrease by only a certain amount

b)

can only increase

40.

ARM cap phase 2

a)

subsequent adjustment cap allows interest to increase

b)

decrease by a percentage

41.

ARM cap phase 3

a)

lifetime adjustment cap limit amount for life of loan

b)

lifetime adjustment cap limit total amount for loan

c)

lifetime adjustment cap limit total amount for life of loan

42.

Bridge loan

a)

mainly for take equity from one home to the other

b)

Not equal one loan

c)

equal one loan

43.

Ballon mortgage

a)

larger than usual payment at the end

b)

larger than usual one time payment at the end

c)

Not larger than usual one time payment at the end

d)

larger than usual three time payment at the end

44.

Fannie Mae (AUS) automated underwriting system

a)

desktop underwriter DU

b)

(HCLTV) high credit loan to value

c)

(CLTV) combined loan to value

d)

HMDA home mortgage disclosure act

45.

Freddie Mac (AUS)

a)

(HTLTV) high total loan to value

b)

(TLTV) total loan to value

c)

(CLTV) combined loan to value

d)

loan product adviser or (LPA),

46.

Back end debt to income ratio/ total expense

a)

borrow monthly liabilities divide by investments monthly income

b)

borrow monthly liabilities divide by their gross monthly income

47.

FHA loans

a)

Annual mortgage insurance required

b)

UFMIP

c)

MIP

d)

PMI

48.

Annual mortgage insurance

a)

Paid daily

b)

Paid yearly

c)

Paid monthly

49.

MIP) mortgage insurance premium

a)

may stay for the life of the loan

b)

safe sound and sanitary properties

c)

May not stay for the life of the loan

50.

Department of Housing and Urban Development HUD

a)

ensures FHA loans

b)

Ensures USDA

c)

protects the lender

d)

Does not protect the lender

51.

Underwriters use four C's when evaluating FHA applications

a)

Credit history

b)

Capacity

c)

Cash

d)

Collateral

52.

Underwriters use when evaluating FHA applications

a)

TILA

b)

(CAIVRS) credit alert verification reporting system

c)

MBS

d)

RESPA

53.

UFMIP

a)

could sometimes be more than PMI

b)

could sometimes be less than PMI

54.

Reverse mortgage

a)

Equity goes up as loan goes down

b)

equity go down as loan goes up

55.

Reverse mortgage

a)

borrow pay taxes

b)

Insurance

c)

Borrow does not pay taxes

d)

No insurance

56.

Va (veteran affairs) loans

a)

UFMIP

b)

annual mortgage insurance

c)

MIP

d)

PMI

57.

Va (veteran affairs) loans

a)

have a funding fee

b)

Don’t have a funding fee

c)

Have mortgage insurance

d)

Don’t have mortgage insurance

58.

IRRRLS VA

a)

interest rate reduction loan

b)

interest rate reduction refinance loan

59.

USDA US department of agriculture loan

a)

UFMIP

b)

Annual mortgage insurance required

c)

PMI

d)

MIP

60.

USDA US department of agriculture loan

a)

no down payment option

b)

down payment option

c)

Rural areas

61.

Jumbo loan

a)

single family loan that exceed Fannie Mae

b)

Ginnie Mae limits

c)

Freddie Mac limits

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