UCE JOB TRAIN REVIEW 2026 UNIT
SHEET WITH CHANGE STEPS GAIN
THINGS
⫸ Which three loans are required to be on nonaccrual? (Choose
three.)
A. A residential real estate loan is 95 days past due, but the borrower
has been making timely monthly payments for five months.
B. A commercial loan with a loan-to-value of 50% is past due 119
days. The borrower has just filed for chapter 11 bankruptcy protection
and repayment is uncertain.
C. An unsecured commercial loan is 87 days past due and the bank
anticipates payment from an insurance settlement within 30 days.
D. A commercial loan is 85 days past due. Collateral is sufficient to
cover the loan's principal balance, but the bank expects to charge-off
$3,000 in interest and $400 in accrued late charges.
E. A $20,0000 single-payment commercial note secured by machinery
and equipment has renewed annually for the last ten years with no
principal reduction. The loan is current, but the entire credit
relationship is rated substandard. Answer: B. A commercial loan with
,a loan-to-value of 50% is past due 119 days. The borrower has just
filed for chapter 11 bankruptcy protection and repayment is uncertain.
D. A commercial loan is 85 days past due. Collateral is sufficient to
cover the loan's principal balance, but the bank expects to charge-off
$3,000 in interest and $400 in accrued late charges.
E. A $20,0000 single-payment commercial note secured by machinery
and equipment has renewed annually for the last ten years with no
principal reduction. The loan is current, but the entire credit
relationship is rated substandard.
⫸ Which three reports should a bank use to monitor loans to finance
a residential construction project? (Choose three.)
A. rent roll
B. Inspection
C. progress report
D. general economic conditions
E. borrower's financial condition Answer: B. Inspection
C. progress report
E. borrower's financial condition
,⫸ Policy and underwriting exceptions are conditions in approved
loans that violate the bank's loan policy or underwriting practices.
Which statement is true regarding the OCC's view of exceptions?
A. Loans with underwriting exceptions indicate unacceptable risk to
the bank.
B. Management may not violate the bank's loan policy if the loan
amount is greater than $50,000.
C. Management may violate the bank's loan policy as long as the loan
amount is less than 5% of capital.
D. Management may violate the bank's loan policy as long as they
document, justify, and track the exception.
E. Loans with underwriting exceptions indicate well-defined
weaknesses, indicating that the loan should be criticized. Answer: D.
Management may violate the bank's loan policy as long as they
document, justify, and track the exception.
⫸ According to the appraisal regulation, which loan requires an
appraisal by a state-certified appraiser?
A. A $200,000 commercial loan secured by rental property.
, B. A $1,100,000 loan fully secured by a U. S. government agency.
D. A $270,000 loan secured by machinery, equipment, and a vacation
home for which the real estate lien was taken as an abundance of
caution.
E. A $1,200,000 loan to purchase commercial real estate that is not
dependent on the sale of, or rental income derived from, the subject
real estate as the primary source of repayment. Answer: E. A
$1,200,000 loan to purchase commercial real estate that is not
dependent on the sale of, or rental income derived from, the subject
real estate as the primary source of repayment.
⫸ The 2006 Interagency policy Statement on the Allowance for Loan
and Lease Losses (ALLL) requires national banks to analyze the
collectibility of its loans and maintain an ALLL at a level that is
appropriate and determined in accordance with GAAP.
Which two statements are true? (Choose two.)
A. Amounts designated as "unallocated" may be included in the
ALLL.
B. If a loan is not impaired under FAS 114, that loan should generally
be included in the assessment of the ALLL under FAS 5.
SHEET WITH CHANGE STEPS GAIN
THINGS
⫸ Which three loans are required to be on nonaccrual? (Choose
three.)
A. A residential real estate loan is 95 days past due, but the borrower
has been making timely monthly payments for five months.
B. A commercial loan with a loan-to-value of 50% is past due 119
days. The borrower has just filed for chapter 11 bankruptcy protection
and repayment is uncertain.
C. An unsecured commercial loan is 87 days past due and the bank
anticipates payment from an insurance settlement within 30 days.
D. A commercial loan is 85 days past due. Collateral is sufficient to
cover the loan's principal balance, but the bank expects to charge-off
$3,000 in interest and $400 in accrued late charges.
E. A $20,0000 single-payment commercial note secured by machinery
and equipment has renewed annually for the last ten years with no
principal reduction. The loan is current, but the entire credit
relationship is rated substandard. Answer: B. A commercial loan with
,a loan-to-value of 50% is past due 119 days. The borrower has just
filed for chapter 11 bankruptcy protection and repayment is uncertain.
D. A commercial loan is 85 days past due. Collateral is sufficient to
cover the loan's principal balance, but the bank expects to charge-off
$3,000 in interest and $400 in accrued late charges.
E. A $20,0000 single-payment commercial note secured by machinery
and equipment has renewed annually for the last ten years with no
principal reduction. The loan is current, but the entire credit
relationship is rated substandard.
⫸ Which three reports should a bank use to monitor loans to finance
a residential construction project? (Choose three.)
A. rent roll
B. Inspection
C. progress report
D. general economic conditions
E. borrower's financial condition Answer: B. Inspection
C. progress report
E. borrower's financial condition
,⫸ Policy and underwriting exceptions are conditions in approved
loans that violate the bank's loan policy or underwriting practices.
Which statement is true regarding the OCC's view of exceptions?
A. Loans with underwriting exceptions indicate unacceptable risk to
the bank.
B. Management may not violate the bank's loan policy if the loan
amount is greater than $50,000.
C. Management may violate the bank's loan policy as long as the loan
amount is less than 5% of capital.
D. Management may violate the bank's loan policy as long as they
document, justify, and track the exception.
E. Loans with underwriting exceptions indicate well-defined
weaknesses, indicating that the loan should be criticized. Answer: D.
Management may violate the bank's loan policy as long as they
document, justify, and track the exception.
⫸ According to the appraisal regulation, which loan requires an
appraisal by a state-certified appraiser?
A. A $200,000 commercial loan secured by rental property.
, B. A $1,100,000 loan fully secured by a U. S. government agency.
D. A $270,000 loan secured by machinery, equipment, and a vacation
home for which the real estate lien was taken as an abundance of
caution.
E. A $1,200,000 loan to purchase commercial real estate that is not
dependent on the sale of, or rental income derived from, the subject
real estate as the primary source of repayment. Answer: E. A
$1,200,000 loan to purchase commercial real estate that is not
dependent on the sale of, or rental income derived from, the subject
real estate as the primary source of repayment.
⫸ The 2006 Interagency policy Statement on the Allowance for Loan
and Lease Losses (ALLL) requires national banks to analyze the
collectibility of its loans and maintain an ALLL at a level that is
appropriate and determined in accordance with GAAP.
Which two statements are true? (Choose two.)
A. Amounts designated as "unallocated" may be included in the
ALLL.
B. If a loan is not impaired under FAS 114, that loan should generally
be included in the assessment of the ALLL under FAS 5.
