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MLO NMLS SAFE PRACTICE EXAM NEWEST
VERSION WTH COMPLETE 300 QUESTIONS AND
WELL ELABORATED ANSWERS LATEST UPDATE THIS
YEAR
Question: What is the name of the Act that entitles a consumer to a free copy of their credit
report if credit is denied based on information from their report? - CORRECT ANSWER✔✔FCRA,
The Fair Credit Reporting Act
Question: What type of loan would commonly use an extended rate lock? - CORRECT
ANSWER✔✔A new construction loan.
Question: While banks remain the largest source of investment funds their increased
participation in long term home mortgage lending is possible because of a change in federal
banking regulations. What is that change? - CORRECT ANSWER✔✔Reserve requirements have
been reduced and first lien home mortgages at less than 80% LTV are in the lowest risk category.
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The banks increased participation in these loans still leave funds available for other loans and
investments.
Question: The adjustable component use to compute the note rate on an ARM is called the
_____________________. - CORRECT ANSWER✔✔Index
Question: According to USDA Rural Development Programs a small town can include up to
________________ people. - CORRECT ANSWER✔✔20,000 people
Question: What kind of buy down would reduce the note rate? - CORRECT ANSWER✔✔A
permanent buy down.
Question: The SAFE act is a key element of (the) _______________________. - CORRECT
ANSWER✔✔HERA, Housing and Economic Recovery Act of 2008
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Question: A Real Estate Company accepted and distributed flyers from a Mortgage Company to
Prospective Clients. Which Law(s) if any have been violated and by who? - CORRECT
ANSWER✔✔No laws have been violated by any party. (per RESPA, there was no agreement to
provide referrals or something of value)
Question: The FHA debt ratios are _____________/__________________. - CORRECT
ANSWER✔✔31/43. 31% Primary Housing Expense (Front End Ratio) and 43% Total Obligations
(Back End Ratio)
Question: The SAFE Act uses unique identifiers instead of _______________. - CORRECT
ANSWER✔✔Social Security Numbers
Question: Lenders report detailed loan information and demographic information because of
which of the following acts?
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1. GLBA
2.HMDA
3.RESPA
4.TIlA - CORRECT ANSWER✔✔HMDA, The Home Mortgage Disclosure Act
Question: Three people own a primary residence as joint owners with rights of survivorship. At
the closing of their refinance, each was given a notice of the right to rescind. How of the three
must exercise that right to cancel the funding? - CORRECT ANSWER✔✔One, any one of the
three can rescind and cancel the refinance transaction
Question: Section 8 of RESPA prohibits _____________________. - CORRECT
ANSWER✔✔Kickbacks for referrals.
4
SUCCESS!
MLO NMLS SAFE PRACTICE EXAM NEWEST
VERSION WTH COMPLETE 300 QUESTIONS AND
WELL ELABORATED ANSWERS LATEST UPDATE THIS
YEAR
Question: What is the name of the Act that entitles a consumer to a free copy of their credit
report if credit is denied based on information from their report? - CORRECT ANSWER✔✔FCRA,
The Fair Credit Reporting Act
Question: What type of loan would commonly use an extended rate lock? - CORRECT
ANSWER✔✔A new construction loan.
Question: While banks remain the largest source of investment funds their increased
participation in long term home mortgage lending is possible because of a change in federal
banking regulations. What is that change? - CORRECT ANSWER✔✔Reserve requirements have
been reduced and first lien home mortgages at less than 80% LTV are in the lowest risk category.
1
SUCCESS!
,Page 2 of 93
The banks increased participation in these loans still leave funds available for other loans and
investments.
Question: The adjustable component use to compute the note rate on an ARM is called the
_____________________. - CORRECT ANSWER✔✔Index
Question: According to USDA Rural Development Programs a small town can include up to
________________ people. - CORRECT ANSWER✔✔20,000 people
Question: What kind of buy down would reduce the note rate? - CORRECT ANSWER✔✔A
permanent buy down.
Question: The SAFE act is a key element of (the) _______________________. - CORRECT
ANSWER✔✔HERA, Housing and Economic Recovery Act of 2008
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Question: A Real Estate Company accepted and distributed flyers from a Mortgage Company to
Prospective Clients. Which Law(s) if any have been violated and by who? - CORRECT
ANSWER✔✔No laws have been violated by any party. (per RESPA, there was no agreement to
provide referrals or something of value)
Question: The FHA debt ratios are _____________/__________________. - CORRECT
ANSWER✔✔31/43. 31% Primary Housing Expense (Front End Ratio) and 43% Total Obligations
(Back End Ratio)
Question: The SAFE Act uses unique identifiers instead of _______________. - CORRECT
ANSWER✔✔Social Security Numbers
Question: Lenders report detailed loan information and demographic information because of
which of the following acts?
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, Page 4 of 93
1. GLBA
2.HMDA
3.RESPA
4.TIlA - CORRECT ANSWER✔✔HMDA, The Home Mortgage Disclosure Act
Question: Three people own a primary residence as joint owners with rights of survivorship. At
the closing of their refinance, each was given a notice of the right to rescind. How of the three
must exercise that right to cancel the funding? - CORRECT ANSWER✔✔One, any one of the
three can rescind and cancel the refinance transaction
Question: Section 8 of RESPA prohibits _____________________. - CORRECT
ANSWER✔✔Kickbacks for referrals.
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SUCCESS!
