NMLS PRACTICE TEST 100 EXAM HARD QUESTIONS WITH
CORRECT ANSWERS 2022
A discount point is BEST described as a charge the borrower pays to:
A.) A lender to decrease the interest rate on the mortgage loan
B.) A mortgage broker at the time of application to obtain a favorable rate
C.) The seller as part of the closing costs of a loan
D.) A lender to ensure against foreclosure - A.) A lender to decrease the interest rate on the
mortgage loan
A buyer has made an earnest money payment of $5,000. The buyer pays an additional $2,000 in
option money to be credited at closing on property with sale price of $160,000. If the required
down payment is 20%, how much additional money will the buyer need to provide toward the
down payment at closing?
A.) $32,000
B.) $27,000
C.) $30,000
D.) $25,000 - D.) $25,000
$160,000 x .20 (20%) = 32000 - $7,000 = $25,000
If an applicant works 40 hours every week and is paid $13.52 per hour, what is the applicant's
monthly income?
A.) $2,163.20
B.) $2,343.47
C.) $2,379.52
D.) $2,487.68 - B.) $2,343.47
$13.52x 40 hours = $540.8 x 52 weeks = $28,121.6 annually /12month = $2,343.47 Monthly
income
The requirement for private mortgage insurance is generally is continued when the loan-to-
value ratio falls below:
A.) 20%
B.) 50%
C.) 80%
D.) 90% - C.) 80%
Which of the following documents itemizes all settlement costs including lender charges?
,A.) Agreement of sale
B.) HUD-1/closing Disclosure
C.) Form 1003
D.) Forbearance agreement - B.) HUD-1/closing Disclosure
According to the Truth-in-Lending Act (TILA), the term "refinance" applies to
A.) A change in a payment schedule
B.) A reduction in annual percentage rate
C.) The renewal of a single payment obligation with no change in the original terms
D.) The satisfaction of an existing obligation and its replacement by a new obligation - D.) The
satisfaction of an existing obligation and its replacement by a new obligation
What does a loan originator use to determine the estimated value of a property based on an
analytical comparison of similar property sales?
A.) An appraisal
B.) A market survey
C.) An area survey
D.) A Cost-benefit analysis - A.) An appraisal
Which of the following methods of disclosure does NOT meet the requirements of Equal Credit
Opportunity Act (ECOA)?
A.) E-mail
B.) Mailed letter
C.) Telephone
D.) Faxed letter - C.) Telephone
Term "20 basis points" expressed as a percentage is:
A.) 0.2%
B.) 0.20%
C.) 2.00%
D.) 20.00% - B.) 0.20%
one hundredth of one percent, used chiefly in expressing differences of interest rates. 0.01
so 0.01 x20 = 0.2
According to the Truth-in-Lending Act (TILA), which if the following fees is EXCLUDED
from the calculation of the annual percentage rate?
A.) Hazard insurance
B.) Wire transfer
C.) Prepaid interest
D.) Mortgage insurance premiums - A.) Hazard insurance
, FHA loans are:
A.) Partially guaranteed
B.) 100% insured
C.) Exempt
D.) Entitled - A.) Partially guaranteed
The late fee for a conventional loan is:
A.) 3% of principle and interest
B.) 4% of principle and interest
C.) 5% of principle and interest
D.) 10% of principle and interest - C.) 5% of principle and interest
A funding fee if required for a:
A.) FHA loan
B.) VA loan
C.) Jumbo loan
D.) Conventional loan - B.) VA loan
A Mortgage Insurance Premium is required on:
A.) FHA loan
B.) VA loan
C.) Jumbo loan
D.) Conventional loan - A.) FHA loan
The mortgagee is the:
A.) Borrower
B.) Lender
C.) Closing agent
D.) Mortgage broker - B.) Lender
The borrower does NOT sign which document:
A.) Deed
B.) HUD-1/Loan Disclosure
C.) Mortgage
D.) Note - A.) Deed
Which documents is usually NOT recorded
A.) Assignment of mortgage
B.) Note
C.) Deed
D.) Mortgage - B.) Note
CORRECT ANSWERS 2022
A discount point is BEST described as a charge the borrower pays to:
A.) A lender to decrease the interest rate on the mortgage loan
B.) A mortgage broker at the time of application to obtain a favorable rate
C.) The seller as part of the closing costs of a loan
D.) A lender to ensure against foreclosure - A.) A lender to decrease the interest rate on the
mortgage loan
A buyer has made an earnest money payment of $5,000. The buyer pays an additional $2,000 in
option money to be credited at closing on property with sale price of $160,000. If the required
down payment is 20%, how much additional money will the buyer need to provide toward the
down payment at closing?
A.) $32,000
B.) $27,000
C.) $30,000
D.) $25,000 - D.) $25,000
$160,000 x .20 (20%) = 32000 - $7,000 = $25,000
If an applicant works 40 hours every week and is paid $13.52 per hour, what is the applicant's
monthly income?
A.) $2,163.20
B.) $2,343.47
C.) $2,379.52
D.) $2,487.68 - B.) $2,343.47
$13.52x 40 hours = $540.8 x 52 weeks = $28,121.6 annually /12month = $2,343.47 Monthly
income
The requirement for private mortgage insurance is generally is continued when the loan-to-
value ratio falls below:
A.) 20%
B.) 50%
C.) 80%
D.) 90% - C.) 80%
Which of the following documents itemizes all settlement costs including lender charges?
,A.) Agreement of sale
B.) HUD-1/closing Disclosure
C.) Form 1003
D.) Forbearance agreement - B.) HUD-1/closing Disclosure
According to the Truth-in-Lending Act (TILA), the term "refinance" applies to
A.) A change in a payment schedule
B.) A reduction in annual percentage rate
C.) The renewal of a single payment obligation with no change in the original terms
D.) The satisfaction of an existing obligation and its replacement by a new obligation - D.) The
satisfaction of an existing obligation and its replacement by a new obligation
What does a loan originator use to determine the estimated value of a property based on an
analytical comparison of similar property sales?
A.) An appraisal
B.) A market survey
C.) An area survey
D.) A Cost-benefit analysis - A.) An appraisal
Which of the following methods of disclosure does NOT meet the requirements of Equal Credit
Opportunity Act (ECOA)?
A.) E-mail
B.) Mailed letter
C.) Telephone
D.) Faxed letter - C.) Telephone
Term "20 basis points" expressed as a percentage is:
A.) 0.2%
B.) 0.20%
C.) 2.00%
D.) 20.00% - B.) 0.20%
one hundredth of one percent, used chiefly in expressing differences of interest rates. 0.01
so 0.01 x20 = 0.2
According to the Truth-in-Lending Act (TILA), which if the following fees is EXCLUDED
from the calculation of the annual percentage rate?
A.) Hazard insurance
B.) Wire transfer
C.) Prepaid interest
D.) Mortgage insurance premiums - A.) Hazard insurance
, FHA loans are:
A.) Partially guaranteed
B.) 100% insured
C.) Exempt
D.) Entitled - A.) Partially guaranteed
The late fee for a conventional loan is:
A.) 3% of principle and interest
B.) 4% of principle and interest
C.) 5% of principle and interest
D.) 10% of principle and interest - C.) 5% of principle and interest
A funding fee if required for a:
A.) FHA loan
B.) VA loan
C.) Jumbo loan
D.) Conventional loan - B.) VA loan
A Mortgage Insurance Premium is required on:
A.) FHA loan
B.) VA loan
C.) Jumbo loan
D.) Conventional loan - A.) FHA loan
The mortgagee is the:
A.) Borrower
B.) Lender
C.) Closing agent
D.) Mortgage broker - B.) Lender
The borrower does NOT sign which document:
A.) Deed
B.) HUD-1/Loan Disclosure
C.) Mortgage
D.) Note - A.) Deed
Which documents is usually NOT recorded
A.) Assignment of mortgage
B.) Note
C.) Deed
D.) Mortgage - B.) Note
