General Mortgage Knowledge
The loan may not be considered a qualified mortgage if a borrower’s debt-to-income ratio is more than
43%
A booklet which must be given to the borrower applying for an adjustable-rate loan
What is the CHARM booklet
What is the maximum punishment for committing loan fraud?
$1,000,000 fine, 30 years in prison, or both per occurrence
A number that permanently identifies each mortgage loan originator.
What is a Unique Identifier?
Residual income, guarantee, certificate of reasonable value
What is a VA Loan
If a lender wished to request copies of tax forms directly from the IRS, they would use IRS form number
4506
When a fictitious borrower obtains a mortgage loan and “secures” it with fictitious property
What is an Air Loan
An applicant for a loan originator license cannot have been convicted of any felony within what period of time prior to applying for the license?
7 Years
When would a lender be required to cancel private mortgage insurance?
Once the LTV reaches 78%, based on the lower of the original appraisal or purchase price.
Private mortgage insurance insures who?
The Lender
A provision of the GLB Act which contains security plan requirements
What is a Safeguards Rule?
The S.A.F.E. Act specifies that pre-licensing education must include at least three hours of? (2 Answers)
What are:
Federal Laws & Regulations
Ethics
Repaid upon the borrower's death or sale of the property
A home equity conversion mortgage (HECM), or reverse mortgage
A borrower closes in April. His first payment is due June 1. If his insurance is due on November 1st, how many months of insurance premiums must be collected at closing to properly fund the escrow account (not accounting for any cushion)?
Seven
Governs the collection and disclosure of consumers’ personal financial information by financial institutions
What are the waiting periods between retaking NMLS tests?
30 Days - 1st & 2nd attempt
180 days - After 3rd attempt
When a large portion of the borrowers principal is repaid in a single payment at the end of a loan period. (HINT: 180/360)
What is a Balloon Mortgage
MATH!
A borrower owes $200,000 on a first mortgage and $50,000 on a line of credit with a maximum amount of $100,000. If the property appraises for $500,000, what is the HCLTV?
60%
The HCLTV of a loan is the loan balance plus the total line limit of any credit line on the property, divided by the appraised value of the property. In this case: $200,000 (first lien) + $100,000 (credit line) = $300,000; $300,000 ÷ $500,000 (appraised value) = 60%.
A measure included in FACTA to address identity theft.
Has the authority to conduct investigations for the purpose of initial licensing or license renewal, license suspension, conditioning, revocation, or termination, and determining compliance with state law.
Who is the the state licensing agency?