National and UST Mortgage Practice
Exam 3 Questions and Answers Graded
A+
When would a license be suspended without a hearing?
A. A licensee fails to renew
B. A request for a hearing is never made with the state regulator
C. A licensee has failed to complete pre-licensing requirements
D. The licensee has already executed a right to a hearing for a previous violation -
Correct answer-B. A request for a hearing is never made with the state regulator
The NMLS does not require a hearing. Under most circumstances, the licensee has
the right to request a hearing. If one is not requested, a hearing is not conducted.
After a borrower allows the assumption of his or her VA loan, he or she may use
his or her VA privilege again only after:
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,A. Five years have passed
B. The home is sold to a new owner
C. The original VA loan is satisfied
D. The original VA loan is moved from his or her name into the name of the
assuming borrower - Correct answer-C. The original VA loan is satisfied
A VA loan is assumable; however, the veteran's VA eligibility is no longer available
until the original VA loan has been satisfied. This means that it is paid off, either
over the remaining amortization time period, sale of the home, or refinancing out
of the VA loan.
In order for a small creditor to originate a balloon payment qualified mortgage, the
small creditor must hold the loan in its portfolio for:
A. Twelve months
B. Three years
C. Two years
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,D. Five years - Correct answer-B. Three years
In order for a small creditor to originate a balloon payment qualified mortgage, the
small creditor must hold the loan in its portfolio for three years.
Conrad began his pre-licensing education in one state and ended up moving to
another state prior to actually submitting an application for a mortgage loan
originator license. What happens to the courses he has completed?
A. NMLS-approved courses are accepted towards credit in any state
B. He must retake them under the requirements of the state in which he currently
resides
C. He can petition the state licensing agency for permission to submit those
courses towards the requirement
D. The courses may or may not be accepted towards pre-licensing credit,
depending on the requirements of the new state - Correct answer-A. NMLS-
approved courses are accepted towards credit in any state
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, Any pre-licensing education course in federal law and regulations, ethics, or
lending standards for the nontraditional mortgage product approved by the NMLS
for any state may be accepted as credit towards completion of pre-licensing
education requirements in the licensing state.
When a seller provides all or part of the financing for the borrower in order to
finance a purchase transaction, it is known as:
A. For sale by owner (FSBO)
B. Seller carry-back
C. Seller concessions
D. Seller self-financed - Correct answer-B. Seller carry-back
In a purchase transaction involving an assumable mortgage, when the party selling
the property provides all or part of the financing, it is referred to as a seller carry-
back.
Which section of the URLA contains questions which, depending on the applicant's
answer, could result in immediate rejection of the application?
©COPYRIGHT 2025, ALL RIGHTS RESERVED 4
Exam 3 Questions and Answers Graded
A+
When would a license be suspended without a hearing?
A. A licensee fails to renew
B. A request for a hearing is never made with the state regulator
C. A licensee has failed to complete pre-licensing requirements
D. The licensee has already executed a right to a hearing for a previous violation -
Correct answer-B. A request for a hearing is never made with the state regulator
The NMLS does not require a hearing. Under most circumstances, the licensee has
the right to request a hearing. If one is not requested, a hearing is not conducted.
After a borrower allows the assumption of his or her VA loan, he or she may use
his or her VA privilege again only after:
©COPYRIGHT 2025, ALL RIGHTS RESERVED 1
,A. Five years have passed
B. The home is sold to a new owner
C. The original VA loan is satisfied
D. The original VA loan is moved from his or her name into the name of the
assuming borrower - Correct answer-C. The original VA loan is satisfied
A VA loan is assumable; however, the veteran's VA eligibility is no longer available
until the original VA loan has been satisfied. This means that it is paid off, either
over the remaining amortization time period, sale of the home, or refinancing out
of the VA loan.
In order for a small creditor to originate a balloon payment qualified mortgage, the
small creditor must hold the loan in its portfolio for:
A. Twelve months
B. Three years
C. Two years
©COPYRIGHT 2025, ALL RIGHTS RESERVED 2
,D. Five years - Correct answer-B. Three years
In order for a small creditor to originate a balloon payment qualified mortgage, the
small creditor must hold the loan in its portfolio for three years.
Conrad began his pre-licensing education in one state and ended up moving to
another state prior to actually submitting an application for a mortgage loan
originator license. What happens to the courses he has completed?
A. NMLS-approved courses are accepted towards credit in any state
B. He must retake them under the requirements of the state in which he currently
resides
C. He can petition the state licensing agency for permission to submit those
courses towards the requirement
D. The courses may or may not be accepted towards pre-licensing credit,
depending on the requirements of the new state - Correct answer-A. NMLS-
approved courses are accepted towards credit in any state
©COPYRIGHT 2025, ALL RIGHTS RESERVED 3
, Any pre-licensing education course in federal law and regulations, ethics, or
lending standards for the nontraditional mortgage product approved by the NMLS
for any state may be accepted as credit towards completion of pre-licensing
education requirements in the licensing state.
When a seller provides all or part of the financing for the borrower in order to
finance a purchase transaction, it is known as:
A. For sale by owner (FSBO)
B. Seller carry-back
C. Seller concessions
D. Seller self-financed - Correct answer-B. Seller carry-back
In a purchase transaction involving an assumable mortgage, when the party selling
the property provides all or part of the financing, it is referred to as a seller carry-
back.
Which section of the URLA contains questions which, depending on the applicant's
answer, could result in immediate rejection of the application?
©COPYRIGHT 2025, ALL RIGHTS RESERVED 4
