MLO, TX Practice Test 1 Questions and Answers 2026

MLO, TX Practice
Test 1 Questions
and Answers 2026
Higher-PricedBMortgageBLoansB(HPML)BareBdefinedBasBclosed-
endBresidentialBmortgageBloansBsecuredBbyBtheBconsumer'sBprincipalBdwellingBwithBan
BAPRBthatBexceedBtheBaverageBprimeBofferBrateB(APOR)BforBcomparableBtransactionsBb
y:B-BAnswer2.5BpercentageBpointsBforBaBfirstBlienBjumboBresidentialBmortgageBloan



TheBTruth-
InBLendingBActBrequiresBresidentialBmortgageBloanBoriginatorsBtoBmakeBcertainB"materi
alBdisclosures"BonBloansBsubjectBtoBtheBRealBEstateBSettlementBProceduresBActBwithinB
three:B-BAnswerBusinessBdaysBafterBreceiptBofBtheBwrittenBapplication.



LendersBmustBreportBunderBtheBHMDABtheBapplicant'sBethnicity,Brace,BandBsex.BWhen
BconductingBaBface-to-
faceBinterviewBinBwhichBtheBapplicantBrefusesBtoBprovideBtheBrequiredBHMDABinforma
tion;BtheBloanBofficerBmustBprovideBtheBinformationBbasedBon:B-
BAnswerAppearanceBandBsurname



AnBAffiliatedBBusinessBArrangementBdisclosureBisBrequiredBtoBbeBgivenBtoBtheBconsum
er?B-BAnswerAtBorBpriorBtoBtheBtimeBofBreferral



UnderBtheBTILABtheBconsumerBhasBaBrightBofBrescissionBinBaBcreditBtransactionBinvolvi
ng:B-BAnswerRefinanceBofBaBprincipleBdwelling.



TheBFairBCreditBReportingBActBallowsBconsumersBallBofBtheBfollowingBexcept:B-
BAnswerDemandBallBreferencesBtoBbankruptciesBbeBremovedBfromBtheirBreportBafterB5
ByearsBfromBtheBdateBofBdischarge.

,UnderBECOA,BwhenBisBaBdisclosureBconcerningBtheBapplicant'sBrightBtoBobtainBaBcopyB
ofBtheBappraisalBreportBdueBtheBconsumer?B-
BAnswerWithinBthreeBbusinessBdayBafterBreceiptBofBtheBwrittenBapplication.



UnderBtheBRedBFlagsBRules,BmortgageBloanBoriginatorsBmustBdevelopBaBwrittenBprogra
mBthatBidentifiesBandBdetectsBtheBwarningBsignsBof:B-BAnswerIdentityBtheft.



ThisBbookletBmustBbeBgivenBtoBeveryBapplicantBconsideringBanBAdjustableBRateBMortga
ge:B-BAnswerConsumerBHandbookBonBAdjustableBRateBMortgages.



AllBofBtheBfollowingBinquiriesBareBconsideredBdiscriminatoryBunderBECOABexcept:B-
BAnswerImmigrationBstatus



TheBTruthBinBLendingBAct'sBadvertisingBprovisionsBrequireBthatBifBanBadvertisementBpro
motingB"closed-
endBcredit"BcontainsBaB"triggeringBterm,"BthreeBspecificBdisclosuresBmustBalsoBbeBinclu
dedBinBtheBadvertisement.BWhichBofBtheBfollowingBisBnotBconsideredBaB"triggeringBter
m"BunderBRegulationBZ?B-BAnswerAPR



ECOABrequiresBthatBaBcopyBofBtheBappraisalBmustBbeBgivenBtoBtheBapplicant:B-
BAnswerPromptlyBuponBitsBcompletionBorBthreeBbusinessBdaysBbeforeBconsummation.



TheBHomeownersBProtectionBActBisBaBconsumerBprotectionBlawBthatBrequiresBservicesB
to:B-
BAnswerAutomaticallyBdiscontinueBPMIBwhenBtheBborrowerBreachesB78%BLTVBasBlongB
asBthereBareBnoBlateBpaymentsBinBtheBpastB12Bmonths.



UnderBtheBTILA,BwhenBaBconsumerBrescindsBaBtransaction,BtheBsecurityBinterestBgiving
BriseBtoBtheBrightBofBrescissionBbecomesBvoidBand:B-
BAnswerTheBconsumerBwillBnoBlongerBbeBliableBforBanyBamount,BincludingBanyBfinance
Bcharge.

, WhichBofBtheBfollowingBisBnotBanBeventBthatBwouldBrequireBaBnewBwaitingBperiodBfor
BtheBClosingBDisclosure?B-BAnswerUnexpectedBdiscoveriesBonBaBfinalBwalk-
throughBrequiringBaBsellerBcreditBtoBtheBbuyer.



InBorderBtoBcomplyBwithBECOA,BaBStatementBofBCreditBDenial,BTermination,BorBChange
BformBmustBbeBretainedBbyBtheBcreditorBforBatBleast:B-BAnswer25Bmonths.



ABtransactionBisBaBHOEPABhigh-
costBmortgageBifBitsBAPRB(measuredBasBofBtheBdateBtheBinterestBrateBforBtheBtransacti
onBisBset)BexceedsBtheBAverageBPrimeBOfferBRateB(APOR)BforBaBcomparableBtransactio
nBonBthatBdateBbyBmoreBthan:B-BAnswer6.5BpercentageBpointsBforBfirst-
lienBtransactionsB$50,000BandBabove.



IfBanBapplicantBisBdeniedBcredit,BtheBlenderBmustBgiveBnoticeBtoBtheBapplicant.BWithin
B_____BdaysBafterBreceiptBofBaBcompletedBapplicationBforBcredit,BaBcreditorBshallBnotif
yBtheBapplicantBofBitsBactionBonBtheBapplication.B-BAnswer30Bdays.



TheBCFPB'sBFinalBRuleBprohibitsBresidentialBmortgageBloanBoriginatorBcompensationBbe
BbasedBonBwhichBofBtheBfollowing?B-BAnswerInterestBrateBofBtheBmortgageBloan.



RMLOsBareBrequiredBtoBfileBsuspiciousBactivityBreportsB("SAR")BwithBtheBFinancialBCrim
esBEnforcementBNetworkB(FinCen):B-
BAnswerNoBlaterBthanB30BcalendarBdaysBafterBtheBdateBofBtheBinitialBdetection.



WhichBofBtheBfollowingBtransactionsBareBcoveredBbyBtheBTILA-RESPABrule?B-
BAnswerConstruction-onlyBloans.



ABtransactionBisBaBHOEPABmortgageBifBitsBpointsBandBfeesBexceedBtheBfollowingBthres
hold:B-
BAnswer5BpercentBofBtheBtotalBloanBamountBforBaBtransactionBwithBaBloanBamountBof
B$21,549BorBmore.