General Mortgage Knowledge
These 2 letters represent high-risk flood zones.
A or V
If borrower Barney Stinson throws a tantrum and does not want to ESign anymore, how long does MLO Ted Mosby have to get the documents that were already ESigned sent out and wet signed?
Previous signatures do not need to be re-signed, only future signatures.
Name the 4 main ethics laws for MLO's.
Fair Housing Act
ECOA Reg B
HMDA Reg C
CRA of 1977
Name the 2 portions of Dodd-Frank that relate to MLOs.
Title X: Consumer Protection Act
Title XIV: Mortgage Reform and Anti Predatory Lending Act
What two entities came together to create the NMLS?
CSBS and AARMR
In an ARM, who sets the Index and the Margin? When you add the two together, what do you get?
Index = Market
Margin = Lender
Index + Margin = Fully Indexed Rate
What is the difference between Constructive Fraud and Actual Fraud?
Actual Fraud = You knew better.
Constructive Fraud = Negligence= You should have known better.
What does HMDA prohibit?
NOTHING!!!
If Mr. Anderson closes the refinance of his home on Wednesday, November 27th, 2019, when will the loan fund?
Tuesday, December 3.
Neo has a 3 business day recession period, which wouldn't include Thanksgiving (November 28) or Sunday. The loan would then fund on day 4.
Will MLO Barney Stinson's MLO license be revoked when he is indicted for Fraud?
No. It will likely be suspended because an indictment is not a conviction.
With an FHA HECM, how many months does a lender have to seek recourse?
None. A HECM (Reverse mortgage) is a non-recourse loan.
Lily wants to refinance her house to pay off her excessive amount of credit cards. Her Attorney-In-Fact, Marshall, goes to the closing because the Captain called Lily to go to an art gallery with him. Can this loan close?
No. An Attorney-In-Fact (aka Power of Attorney) cannot sign for a cash-out transaction.
What do branches of lenders have to have displayed in their office?
Equal Housing Opportunity logo
What does the phrase "100% VA Loans Available" in an advertisement trigger?
Nothing. 100% VA Loans Available is not a trigger term.
If you teach a 1 hour class, how much credit do you get for your CE?
What is the longest possible amount of time a lender would have to wait to accelerate a mortgage loan?
210 Days. The fastest a lender can is 120 days, however if a borrower seeks HUD counseling, it puts a 90 day hold on the acceleration.
What is the legal name of GLB, what regulation is it, and what are the specific rules?
Financial Services Modernization Act of 1999
Reg P
Safeguards Rule, Pretexting Provisions, Financial Privacy Rule
Can a lender receive a bonus for not redlining?
Yes. That is literally what the CRA of 1977 does.
What was the purpose of the MLO Comp Rule?
To prevent steering by MLOs
A Real Estate Attorney occasionally helps friends with MLO-like duties once or twice a year outside of his practice. Does he need a license?
No. He is not doing more than 5 a year.
What is the statute of limitations to file an ECOA complaint to HUD?
ECOA complaints do not get reported to HUD. They get reported to the state authority or CFPB. If they are reporting it CFPB, the statute of limitations (how long they have to report) is 25 months.
At what LTV percentage can a borrower request a PMI cancellation, and what are the 3 requirements to do so?
80%
12 months clean payment history
2nd appraisal
3 years into the loan
Is it ever ok for an MLO to racially profile an applicant?
Yes. If the applicant does not fill out section X of the 1003 and the applicant fills it out in person, the MLO is required provide best-guess answers based on visual observation and last name.
What regulation sets escrow requirements for a HOEPA loan?
TILA/Reg Z.
While escrow requirements are a part of RESPA, HOEPA/HPML is governed by TILA.
How many hours of pre licensing education does a future MLO need and what does that entail?
20 hours
3 Laws
3 Ethics
2 Non-Traditional
12 Elective