NMLS SAFE-MLO Online Practice Questions and Exam Preparation

NMLS SAFE-MLO Online Questions & Answers

• Question 101:

  Which of the following responses describes the required amount of flood insurance coverage?

  A. The original appraised value of the home
  B. The outstanding principal balance of the loan
  C. The minimum amount of National Flood Insurance Program coverage available
  D. The property value on file with the county property valuation administrator office
  B. The outstanding principal balance of the loan

• Question 102:

  Which of the following reasons is acceptable for denying a loan under the Equal Credit Opportunity Act (ECOA)?

  A. Receipt of child support
  B. Immigration status
  C. Marital status
  D. Country of birth
  B. Immigration status

• Question 103:

  It is acceptable for a lender to request a co-applicant in which of the following situations?

  A. The borrower will not qualify for the loan on their own.
  B. The borrower's future income is dependent on the co-applicant.
  C. The co-applicant will be residing in the house with the borrower.
  D. The co-applicant is gifting money to the borrower to make a down payment on a purchase-money mortgage
  A. The borrower will not qualify for the loan on their own.

• Question 104:

  A mortgage loan in which a large portion of the borrowed principal is repaid at the end of the loan period is known as a:

  A. FHA mortgage.
  B. balloon mortgage.
  C. qualified mortgage.
  D. deferred-payment mortgage.
  B. balloon mortgage.

• Question 105:

  Which of the following activities is an example of redlining in mortgage lending?

  A. Ensuring that all creditworthy borrowers are afforded equal treatment when applying for a mortgage loan
  B. The mortgage loan originator convincing the underwriter to move their loan file to the front of the line or "redline" it
  C. The act of the mortgage lender putting a "red line" under the borrower's name in a file to indicate they are a substandard applicant
  D. The systematic denial of various services to residents of specific, often racially associated, neighborhoods or communities, either explicitly or through the selective raising of prices
  D. The systematic denial of various services to residents of specific, often racially associated, neighborhoods or communities, either explicitly or through the selective raising of prices

• Question 106:

  A borrower visits a mortgage loan originator (MLO) for Mortgage ABC to discuss getting a home equity line of credit (HELOC) loan from Bank LMN. The MLO encourages the borrower to apply with Bank XYZ instead because ABC does not provide HELOC loans.

  When the borrower submits an application directly to XYZ, XYZ pays the MLO $100 from the 1% origination fee that it collected from the borrower. Is this fee permissible?

  A. The fee is permitted if the fee is disclosed on the final settlement statement.
  B. The fee is permitted as the MLO performed origination services for the borrower.
  C. The fee is not permitted as the MLO did not perform any actual origination services for the borrower.
  D. The fee is not permitted as the MLO did not perform any actual origination services for the borrower, unless the fee was paid directly by the borrower.
  C. The fee is not permitted as the MLO did not perform any actual origination services for the borrower.

• Question 107:

  Which of the following statements defines the term "business day" in a mortgage rescission under the Truth in Lending Act (TILA)?

  A. Every day from 9 a.m. to 5 p.m.
  B. Every day except Sunday and legal holidays
  C. Any days except Saturdays and Sundays
  D. Any days that employees may access the office to work
  B. Every day except Sunday and legal holidays

• Question 108:

  Consumer complaints and the analysis of complaints play a vital role in identifying weaknesses in elements of a company's:

  A. hiring procedures and training.
  B. compliance management training and internal controls
  C. secondary marketing practices of selling loans to investors.
  D. compliance management, senior management and branch locations.
  B. compliance management training and internal controls

• Question 109:

  The appraiser valuation independence obligates appraisers to perform their duties in a manner free from outside influence through which of the following actions?

  A. Encouraging a target value
  B. Withholding payment from an appraiser
  C. Asking the appraiser to substantiate a value
  D. Communication directly between the loan officer and the appraiser
  C. Asking the appraiser to substantiate a value

• Question 110:

  Which of the following types of income are considered as qualifying when applying for a mortgage loan?

  A. Reimbursed expenses
  B. Net rental income
  C. Family gifts
  D. Federal tax refund
  B. Net rental income