Utah Practice Exam - Questions PDF

UTAH PRACTICE EXAM – QUESTIONS Under the S.A.F.E. Act, “general ﬁtness” to gain the conﬁdence of the community for licensure might include any of the following, except: A. Showing consistent proﬁtability for a set period of Nme B. Paying into a state fund C. MeeNng net worth requirements D. MeeNng surety bond requirements Any loan modiﬁcaNon agreement must include a provision allowing the borrower the right to cancel: A. Within three years aTer the date of the agreement B. Within three business days aTer the date of the agreement C. Within 24 hours aTer the date of the agreement D. At any Nme This person acts by or on behalf of another principal lending manager in transacNng residenNal mortgage loans. A. Mortgage loan originator B. Loan oﬃcer C. Branch lending manager D. Associate lending manager The Mortgage and Financial Fraud Unit exists within: A. The Department of Financial InsNtuNons B. The Division of Real Estate C. The Division of Commerce D. The Oﬃce of the AYorney General UTAH PRACTICE EXAM – QUESTIONS Common underwriNng pi[alls include all of the following, except: A. Including alimony or child support in debts B. Sales contract not fully executed C. Undocumented assets D. Failing to disclose secondary ﬁnancing The central database through which mortgage professionals submit informaNon and license applicaNons is the: A. NMLS B. Commission C. Mortgage and Financial Fraud Unit D. The SAFE System Principal lending managers have an aﬃrmaNve duty to: A. Supervise only ALMs B. Supervise all ALMs and BLMs C. Approve licensure of BLMs D. Supervise only BLMs A person who has had a mortgage loan originator license revoked in another state must wait at least how long before being able to obtain a Utah license? A. Ten years B. Three years C. Five years D. A license cannot be obtained UTAH PRACTICE EXAM – QUESTIONS The Fair Housing Act prohibits discriminaNon based on: A. Race, sex, age, color, religion, handicap B. Handicap, familial status, sex, naNonal origin, religion, color, race C. Race, sex, color, religion, age, familial status, handicap D. Race, color, religion, sex, age A determinaNon of repayment ability must be based on all of the following, except: A. The equity the borrower already has in the dwelling B. The credit history of the borrower C. The borrower’s monthly debt-to-income raNo D. The borrower’s current employment status Statements in adverNsing that may lead a consumer to incorrectly assume that a mortgage product or company is directly endorsed by the federal government are in violaNon of which law? A. RegulaNon B B. RegulaNon Z C. RegulaNon A D. RegulaNon X An “exempt” employee generally means the employee is: A. Exempt from tax withholding requirements B. Ineligible for overNme pay C. Ineligible for Social Security withholdings D. Exempt from salary recordkeeping requirements UTAH PRACTICE EXAM – QUESTIONS The ___________________ was created to detect, invesNgate, prosecute, and deter mortgage fraud and other major ﬁnancial fraud crimes in Utah. A. Division of Fraud InvesNgaNon B. NMLS C. Mortgage and Financial Fraud Unit D. Real Estate Commission Which of the following is not prohibited by RESPA? A. Referral fees B. Premiums charged on fees for third-party services C. Reasonable fees paid for services actually performed D. Kickbacks What is the primary intent of RESPA? A. Protect the privacy of a borrower’s personal ﬁnancial informaNon B. Eliminate unearned fees, such as referral fees, kickbacks, and fee splidng C. Protect borrowers from misleading adverNsing D. Provide the borrower an opportunity to rescind certain types of loans This subsecNon of the federal Housing and Economic Recovery Act was established to ensure minimum qualiﬁcaNon standards for mortgage professionals. A. USPAP B. FIRREA C. The S.A.F.E. Act D. The Gramm-Leach-Bliley Act UTAH PRACTICE EXAM – QUESTIONS Which of the following preﬁxes indicates the purchase of ﬂood insurance is mandatory? A. B, C, and D B. A and D C. A and V D. V and D All adverNsing and markeNng materials used by a licensee must be reviewed for compliance by the: A. Control person B. Compliance specialist C. Designated oﬃcer D. Lending manager An aﬃliated business arrangement established for the illegal purpose of collecNng excessive fees from consumers and splidng them among parNcipants is known as: A. A sham aﬃliated business arrangement B. A false seYlement service markup C. Kickbacks D. Table funding If a lending manager stops being sponsored by a licensed enNty: A. Their license remains valid for 30 days and then becomes inacNve B. Their license is immediately revoked C. Their license is immediately inacNve D. Their license is immediately suspended UTAH PRACTICE EXAM – QUESTIONS Which of the following is false regarding branch managers? A. A branch manager may serve as the manager for up to three licensed branch oﬃces B. A branch manager may only serve at one branch oﬃce at a Nme C. Utah state law requires the appointment of branch managers for licensed locaNons that are not in the same place of business as the main locaNon where the PLM works D. The primary lending manager may not serve as the branch manager at a diﬀerent locaNon Who is responsible for proper record disposal if an enNty ceases to do business in Utah? A. The principal lending manager B. Records must be returned to the Division C. Records must be returned to consumers about whom informaNon has been maintained D. The control person A principal lending manager will not be held liable for failing to maintain reasonable supervision if he or she can show evidence of any of the following, except: A. AYempts made to prevent or miNgate damage when learning of a violaNon B. AYempts to conceal damage when learning of a violaNon C. Existence of wriYen policies to prevent violaNons D. The fact that the PLM did not aYempt to avoid learning of a violaNon A licensed loan originator is working for a licensed enNty. Which of the following is true? A. He or she can only work for the licensed enNty with which he or she is currently employed B. He or she can work for only one other enNty, and that enNty must be exempt C. He or she can work for only one other enNty, and that enNty must also be licensed D. He or she cannot work with a licensed enNty and must work as an individual MLO UTAH PRACTICE EXAM – QUESTIONS How many total hours of pre-licensing educaNon are required for a mortgage loan originator license applicant who does not currently hold a license in any jurisdicNon? A. 15 B. 40 C. 35 D. 20 This federal law is primarily concerned with disclosures and adverNsing. A. The Real Estate SeYlement Procedures Act B. The Equal Credit Opportunity Act C. The Truth-in-Lending Act D. The Home Mortgage Disclosure Act If an individual wants to become licensed as a lending manager, he or she has to show: A. Ten years of veriﬁable ﬁnancial responsibility B. At least three years of full-Nme experience originaNng mortgages C. A history of work experience as a lending manager D. A credit score of at least 780 The license of a person who commits mortgage fraud: A. Is automaNcally revoked B. Is temporarily revoked and may be permanently revoked aTer a hearing C. Is put on inacNve for twice as long as the violator’s sentence of imprisonment D. May be suspended for up to ﬁve years UTAH PRACTICE EXAM – QUESTIONS Seller concessions for VA loans are limited to: A. 3% B. 0% C. 6% D. 4% The Closing Disclosure is due: A. No later than one business day prior to consummaNon B. No later than ten business days prior to consummaNon C. No later than seven business days prior to consummaNon D. No later than three business days prior to consummaNon What is the latest date by which a license may be reinstated? A. January 1 B. November 1 C. December 31 D. February 28 The liability of the Recovery Fund for a single licensee may not exceed: A. $45,000 B. $20,000 C. $15,000 D. $35,000 Engaging in this will result in automaNc revocaNon of the license. A. Failure to complete educaNon requirements B. Mortgage fraud C. Failure to secure a sponsor D. High-cost mortgage loan originaNon UTAH PRACTICE EXAM – QUESTIONS On the iniNal license applicaNon, mortgage enNNes are required to designate a qualifying individual, also known as a: A. Control person B. Lending manager C. Branch oﬃcer D. Responsible party On which porNon of the loan applicaNon would one ﬁnd a street address and legal descripNon of the property? A. SecNon II B. SecNon III C. SecNon XV D. SecNon X The iniNal escrow statement is typically provided: A. At seYlement B. At the same Nme that a Loan EsNmate is issued C. Within three business days aTer issuing a Closing Disclosure D. Within three business days aTer receiving a completed applicaNon If a PLM license becomes inacNve: A. The PLM must obtain a new license to become acNve again B. The PLM may never serve as a PLM again C. The PLM may not conduct mortgage business D. The PLM may not act as a lending manager but may act as a loan originator UTAH PRACTICE EXAM – QUESTIONS OverNme income may be considered for an hourly employee if: A. It has been consistent for less than two years and is likely to conNnue B. The earnings have been reported as wages C. It is being paid in the same paycheck D. It has been consistent for at least two years and is likely to conNnue What does it mean when a loan results in negaNve amorNzaNon? A. The payment amounts increase over Nme as the interest rate decreases B. The payments steadily reduce the amount of interest due each month, so the unpaid balance decreases instead of increasing C. The payment amounts decrease over Nme as the interest rate decreases D. The payments are not enough to cover the interest due, so the unpaid balance increases instead of decreasing Utah requires that licensees complete an addiNonal annual course on: A. Utah law B. Mortgage fraud C. Consumer protecNon D. NontradiNonal products If fees for third-party seYlement service providers are paid directly to a creditor or one of its aﬃliates, the tolerance for diﬀerences between the esNmated and actual charges is: A. 2% B. 5% C. 0% D. 10% UTAH PRACTICE EXAM – QUESTIONS An applicant for a lending manager license with only two years of full-Nme experience originaNng ﬁrst lien residenNal mortgage loans may sNll qualify for the license if he or she shows proof of all of the following, except: A. Evidence of having completed lending manager qualiﬁcaNon counseling B. Up to 15 addiNonal points according to the experience points schedule C. Evidence of having originated at least 30 ﬁrst lien residenNal mortgage loans D. AddiNonal full-Nme experience according to the equivalency calculaNon Which of the following likely cannot be used to verify a borrower’s ability to repay, according to the ATR Rule? A. Bank records B. Voided checks C. W-2 forms D. Payroll statements Which federal labor law sets forth safety and health condiNons for private and public sector workers? A. The Safe Workplace Enforcement Act B. The OccupaNonal Safety and Health Act C. The Fair Labor Standards Act D. The Labor-Management ReporNng and Disclosure Act TILA is parNcularly concerned with the use of ___________ in adverNsing, which require the disclosure of certain informaNon to consumers. A. Red ﬂags B. Trigger terms C. Unique idenNﬁers D. Business names A conclusive presumpNon of compliance applies to: UTAH PRACTICE EXAM – QUESTIONS A. Qualiﬁed mortgages that are higher-priced mortgage loans B. Non-qualiﬁed mortgages C. Qualiﬁed mortgages that are subprime mortgages D. Qualiﬁed mortgages that are prime mortgages The ________________ is deﬁned as the cost of credit expressed as a dollar amount. A. Finance charge B. Annual percentage rate C. Prepayment penalty D. Yield spread premium Mortgage loan originators must solicit and conduct business solely in the name of: A. The ALM B. Themselves C. The sponsoring enNty D. The PLM If a license is not expired, but it belongs to a person who is not currently engaged in the business of residenNal mortgage loans, that license is considered: A. Dormant B. InacNve C. Suspended D. In escrow When a loan is characterized as “conforming,” this means the loan: UTAH PRACTICE EXAM – QUESTIONS A. Meets guidelines established by Fannie Mae and Freddie Mac B. Meets standards for a government program C. Is a 30-year ﬁxed D. Requires no PMI A party who has been served a cease and desist order from the Director may request a hearing within: A. Seven days of receiving the order B. 30 days of receiving the order C. Ten days of receiving the order D. 15 days of receiving the order Which of the following is not an accurate statement regarding the NMLS? A. It is used to help streamline the licensing process B. It is responsible for the approval of pre-licensing and conNnuing educaNon courses used by licensees C. It is a regulatory agency for mortgage professionals naNonwide D. It relieves license applicants of the burden of resubmidng informaNon in the database The Division deﬁnes all of the following as unprofessional conduct, except: A. Altering an appraisal of real property B. Withholding payment to a third-party seYlement service provider C. Requiring a borrower to pay for third-party services D. Failing to fulﬁll aﬃrmaNve duNes The ResidenNal Mortgage PracNces and Licensing Act requires the consideraNon of which of the following factors in determining the penalty for mortgage fraud? UTAH PRACTICE EXAM – QUESTIONS A. The total value of all property, money, or things obtained by commidng mortgage fraud B. Whether the act or fraud was a conspiratorial eﬀort C. The county where the fraud took place D. The age of the vicNm, if fraud was commiYed against an individual The administraNve body exisNng within the DRE to help in regulaNng mortgage professionals is: A. The Mortgage AnN-Fraud CommiYee B. The ResidenNal Mortgage Regulatory Commission C. The Division of Financial InsNtuNons D. The Consumer ProtecNon Unit Which of the following is an example of open-ended credit? A. Adjustable-rate mortgage B. Purchase money mortgage C. HELOC D. OpNon-ARM Who is responsible for reviewing all adverNsing and markeNng materials used by a licensed enNty and sponsored mortgage loan originators to ensure compliance? A. Lending managers and branch managers B. Control persons C. The NMLS D. The Director Upfront MIP is collected: A. On all PMI loans UTAH PRACTICE EXAM – QUESTIONS B. On all loans C. On all FHA loans D. On reverse mortgage loans A mortgage loan originator adverNses in conjuncNon with a real estate brokerage. The adverNsement features contact informaNon for both enNNes, the role of the brokerage in transacNons, and the services the MLO may provide. Which of the following is true? A. This is not legal; mortgage loan originators in Utah are prohibited from adverNsing the sale of real estate in any medium B. This is not legal; mortgage loan originators in Utah are prohibited from adverNsing C. This is not legal; mortgage loan originators in Utah may only adverNse the sale of real estate in “For Sale by Owner” transacNons D. This is legal and in compliance with Utah law An act of mortgage fraud with a value that is or exceeds $5,000 is: A. A Class A misdemeanor B. A third degree felony C. A gross misdemeanor D. A second degree felony VA loans require which of the following? A. VA appraiser premium B. Eligibility fee C. Mortgage insurance premium D. Funding fee Which of the following is true of VA loans? A. They are only available for 30-year terms UTAH PRACTICE EXAM – QUESTIONS B. They require a mortgage insurance premium C. They are assumable D. They require a 5.5% borrower investment All of the following are licensing requirements for principal lending managers, except: A. Proof that he or she has obtained a sponsor B. Proof of compleNon of at least ﬁve years of experience as a mortgage loan originator C. Proof of the compleNon of 40 hours of Utah-speciﬁc educaNon during the 12-month period preceding the applicaNon D. Proof that he or she meets the general qualiﬁcaNons for licensure that are applicable to mortgage loan originators Which of the following best describes a loan used to ﬁnance a property in an amount that exceeds Fannie Mae and Freddie Mac’s guidelines? A. Jumbo loan B. FHA loan C. VA loan D. Non-convenNonal loan A licensed mortgage enNty is changing its name. Which of the following is true? A. The DFI must be noNﬁed within ten days B. The DRE must be noNﬁed within ten days C. The DRE must be noNﬁed within ﬁve days D. The DFI must be noNﬁed within ﬁve days A mortgage point is _______, and it is: A..1% of the loan amount; used to pay an originaNon fee UTAH PRACTICE EXAM – QUESTIONS B. 1% of the loan amount; used to pay an originaNon fee C..1% of the loan amount; used to reduce the interest rate D. 1% of the loan amount; used to reduce the interest rate A licensee enters into a loan modiﬁcaNon agreement with a consumer. Which of the following is correct? A. The transacNon is illegal – loan modiﬁcaNon specialists are not permiYed to enter into agreements with consumers B. The transacNon is legal – Utah does not regulate loan modiﬁcaNon acNviNes C. The transacNon is legal – as long as the agreement provides for the right to cancel within three business days D. The transacNon is illegal – the state of Utah does not permit loan modiﬁcaNons to be handled by anyone but federally-regulated depository insNtuNons If a borrower is considering purchasing discount points, one of the most important factors to keep in mind is: A. The loan amount B. Pricing hits C. The break-even point D. The cost Which of the following is not a prohibited act under Utah state law? A. Altering an appraisal of real property B. Giving an appraisal report to the borrower C. Encouraging default on an exisNng loan D. Obtaining Ntle insurance without a license A loan originator who has ﬁled for personal bankruptcy must noNfy the DRE within: A. Five days B. Five business days UTAH PRACTICE EXAM – QUESTIONS C. Ten business days D. Ten days Caps on ARMs: A. Are mandatory for any lender oﬀering ARM products B. Prevent a lender from calling a loan due if there is delinquency C. Limit the amount the interest rate or payment may change D. Limit whether a loan is eligible for prepayment When sponsorship is terminated: A. The originator must maintain all records in his or her possession for at least two years aTer terminaNon B. The originator must turn all records in his or her possession over to the NMLS C. The originator must turn all records in his or her possession over to the sponsoring enNty when sponsorship is terminated D. The originator must destroy all records in his or her possession Prepayment penalNes are permiYed for: A. Higher-priced mortgage loans B. Subprime loans regulated by HOEPA C. Fixed-rate qualiﬁed mortgages D. All loans secured by a borrower’s principal residence Which of the following is not an aﬃrmaNve duty of a principal lending manager? A. Ensuring that licensees do not oﬀer high-cost mortgage loans B. Establishing and following procedures for responding to consumer complaints UTAH PRACTICE EXAM – QUESTIONS C. Reviewing all adverNsing and markeNng for compliance with federal and state law D. Establishing and maintaining an adequate quality control plan The required record retenNon period for mortgage professionals is: A. Four years from closing B. Four years from the date of loan applicaNon C. Two years from closing D. Two years from the date of loan applicaNon A loss payee clause in a hazard insurance policy protects: A. The property B. The lender C. The borrower D. The servicer Increasing loan balances resulNng from the applicaNon of periodic payments that are not suﬃcient to cover the interest that is due creates which of the following for borrowers? A. NegaNve equity B. NegaNve amorNzaNon C. AmorNzing payments D. Lower credit scores Fees charged for an early repayment of a debt are known as: A. Prepayment penalty B. Finance charges UTAH PRACTICE EXAM – QUESTIONS C. Deferred payment loan D. AcceleraNon Which of the following is not a license type oﬀered by the Division of Real Estate? A. Mortgage servicer B. Mortgage enNty C. Mortgage branch oﬃce D. Mortgage loan originator What does “APR” mean? A. Adjusted pricing raNo B. Annual percentage raNo C. Annual percentage rate D. Appraised property raNo A wholesale lending arrangement that permits a mortgage broker to originate, close, and fund a loan using a warehouse line of credit is called: A. Warehouse servicing B. Table lending C. Warehouse lending D. Table funding If acNon is taken against a person, he or she may seek judicial review by the: A. Commission B. Governor UTAH PRACTICE EXAM – QUESTIONS C. AYorney General D. Director Utah’s ResidenNal Mortgage Regulatory Commission consists of: A. Four members that serve four-year terms B. Five members that serve two-year terms C. Four members that serve two-year terms D. Five members that serve four-year terms Mortgage-backed securiNes (MBSs) are a product of which of the following? A. Stock market volaNlity B. The secondary market C. The primary mortgage market D. Increased subprime originaNons Which of the following is a factor that is likely to lead to a pricing hit? A. A credit score of 740 B. A low loan-to-value raNo C. A loan secured by an owner-occupied primary residence D. A high loan-to-value raNo Which of the following would not be considered an appraisal red ﬂag? A. Blurry photos or photos that appear to be downloaded B. Adjustments that exceed guidelines C. Appraisal dated prior to the sales contract D. Comparables within one mile of the subject property and sold within one year Every loan originator must: A. Be aﬃliated with a PLM UTAH PRACTICE EXAM – QUESTIONS B. Work as an independent contractor C. Also be licensed as a PLM D. Also be licensed as a loan processor The individual who is responsible for a mortgage enNty’s proper disposal of personal informaNon is: A. The control person B. The ALM C. The PLM D. A licensed mortgage loan originator that the PLM designates An appraiser uses any one of three appraisal approaches to determine the value of a property. They are: A. Sales, cost, and comparable B. Market comparison, cost comparison, and investment approach C. Sales comparison, market comparison, and subject comparison D. Sales comparison (or market), cost, and income The VA guarantee covers up to what value of the veteran’s enNtlement? A. 25% coverage B. Four Nmes the amount of the veteran’s enNtlement C. Half the amount of the loan D. Four Nmes the amount of the loan The Qualiﬁed Mortgage Rule establishes a debt-to-income raNo standard of _____ for qualiﬁed mortgages. A. 78% B. 43% C. 60% UTAH PRACTICE EXAM – QUESTIONS D. 80% Two federal laws that relate to the conﬁdenNality of personal ﬁnancial informaNon are: A. FTC Disposal Rule and FNMA ApplicaNon Rule B. GLB Safeguards Rule and FTC Disposal Rule C. RESPA and FTC Disposal Rule D. GLB Safeguards Rule and RESPA The most commonly-used type of reverse mortgage is known as a: A. Home equity consolidaNon mortgage B. Home equity conversion mortgage C. Home equity line of credit D. Home equity compleNon loan The ﬁrst step in the closing process is: A. Funding B. Steering C. Rescission D. ApplicaNon A person who qualiﬁes as a PLM and works by or on behalf of another PLM in transacNng mortgage business is: A. A secondary principal lending manager B. A mortgage loan originator C. An assistant lending manager D. An associate lending manager UTAH PRACTICE EXAM – QUESTIONS With regard to qualiﬁed mortgages, the Veterans AdministraNon has stated that VA-insured or – guaranteed loans are: A. Exempt from qualiﬁed mortgage standards B. Temporary qualiﬁed mortgages C. Safe harbor qualiﬁed mortgages D. Not qualiﬁed mortgages Which fair lending law requires lenders to obtain informaNon on the race and sex of loan applicants? A. The Home Mortgage Disclosure Act B. The Equal Credit Opportunity Act C. The Fair Credit ReporNng Act D. The Fair Housing Act The DRE is headed by the: A. Director B. Governor C. Superintendent D. Commissioner Which federal law creates aﬃrmaNve requirements for ﬁnancial insNtuNons to ensure that third-party service providers are taking appropriate acNons to protect consumer privacy? A. The SAFE Act B. The Gramm-Leach-Bliley Act C. The Safeguards and Disposal Act D. The Consumer Privacy ProtecNon Act UTAH PRACTICE EXAM – QUESTIONS A mortgage loan originator in Utah who is sponsored by an enNty may adverNse: A. Under the name of the enNty or a registered branch oﬃce or trade name B. Mortgage loan originators in Utah are prohibited from adverNsing C. Under his or her own name only D. Only under his or her own name and only online A Closing Disclosure is due: A. No later than three business days prior to consummaNon B. No later than ﬁve business days aTer applicaNon C. No later than seven business days prior to consummaNon D. No later than seven business days aTer applicaNon Borrowers of this type of loan are only permiYed to pay for certain closing costs. Costs they are prohibited from paying are typically paid by the seller in the transacNon. A. USDA loans B. VA loans C. Reverse mortgages D. FHA loans An aﬃliated business arrangement disclosure is due: A. Within three business days aTer receiving a completed loan applicaNon B. At the Nme the referral is made C. At or before closing D. Within ﬁve days aTer receiving a completed loan applicaNon Which of the following accurately describes supervision of mortgage professionals in Utah? UTAH PRACTICE EXAM – QUESTIONS A. Most are overseen by the DRE; some remain under the authority of the DFI B. Most are overseen by the DFI; some remain under the authority of the DRE C. All are overseen by the DFI D. All are overseen by the DRE APR is deﬁned as: A. A measure of the cost of credit expressed as a nominal yearly rate B. The cost of credit expressed as a dollar amount C. The most that an interest rate may change from year to year D. The most that an interest rate may change over the life of the loan What is the name of the rule that increases requirements for the consideraNon of a borrower’s ability to repay? A. The HOEPA Rule B. The ATR Rule C. The ValuaNons Rule D. The HPML Appraisal Rule The loan-to-value raNo is calculated using which two numbers? A. The property value and the purchase price B. The loan amount and the property value or purchase price (whichever is less) C. The loan amount and the loan term D. The property value or purchase price (whichever is less) and the loan term In a deed of trust, the right that the trustee has to proceed with non-judicial foreclosure is called: UTAH PRACTICE EXAM – QUESTIONS A. Deed in lieu B. Power of aYorney C. Right to mortgage D. Power of sale Which of the following would require issuance of a revised Loan EsNmate? A. A delay caused by the consumer B. A change in the interest rate C. A change requested by the consumer D. A change in the borrower’s eligibility Which appraisal approach is most commonly used to appraise new home construcNon? A. The cost approach B. The market approach C. The income approach D. The sales comparison approach The required disclosure under the High Cost Home Loan Act: A. Speciﬁes that the consumer may not qualify for a loan if he or she does not obtain counseling B. Provides a comprehensive summary of seYlement and loan closing documents C. Advises that the consumer is not required to complete the loan agreement and warns against default D. Reviews the fees and charges associated with the high-cost loan transacNon UTAH PRACTICE EXAM – QUESTIONS Rescission: A. Restores each party in a contract to the posiNon held prior to the transacNon B. Allows the borrower to modify his or her loan to avoid foreclosure C. Is the Nme at which a consumer becomes contractually obligated on a credit transacNon D. Allows the borrower to cease being obligated to make mortgage payments A principal lending manager is diﬀerent from a control person because: A. There is no diﬀerence between a principal lending manager and a control person B. A principal lending manager is always required to be licensed; a control person is not C. A control person is always required to be licensed; a principal lending manager is not D. A control person has educaNon requirements; a principal lending manager does not Which federal labor law sets the standards for wages and overNme pay in private and public employment? A. The Family Medical Leave Act B. The Federal Employees’ CompensaNon Act C. The Fair Labor Standards Act D. The OccupaNonal Safety and Health Act This is the pracNce of a mortgage professional guiding potenNal borrowers toward certain mortgage products in order to increase the amount of compensaNon the originator will earn. A. Steering B. Dual compensaNon C. Reverse redlining D. Redlining This federal law requires the collecNon of certain data on applicaNon forms, though this informaNon may not be considered when making a credit decision. UTAH PRACTICE EXAM – QUESTIONS A. The Real Estate SeYlement Procedures Act B. The Equal Credit Opportunity Act C. The Truth-in-Lending Act D. The Home Mortgage Disclosure Act Which of the following individuals might be involved in appraisal fraud? A. All of these answers are correct B. Appraiser C. Borrower D. Mortgage broker Seller concessions are limited to ____ for borrowers who make a down payment of 10% to 24.9%. A. 4% B. 6% C. 3% D. 10% The federal Homeowners ProtecNon Act is concerned with: A. Private mortgage insurance (PMI) B. Mortgage insurance premiums (MIP) C. Foreclosure D. Reverse mortgage loans USDA loans are primarily for properNes located in: A. Metropolitan areas B. Rural areas UTAH PRACTICE EXAM – QUESTIONS C. Suburban areas D. Urban areas Seller concessions are limited to _____ for borrowers who make a down payment of less than 10%. A. 6% B. 10% C. 4% D. 3% The basic diﬀerence between an employee and a contractor is: A. The employer withholds and pays taxes from the wages of a contractor, but not for those of an employee B. The employer withholds and pays taxes from the wages of an employee, but not for those of a contractor C. Contractors do not work for employers; employees do D. Contractors are subject to the employer’s control over every step of the work process, while employers are not “ConsummaNon” refers to: A. The Nme at which a lender becomes contractually obligated to the seller B. The Nme at which a consumer becomes contractually obligated to the seller C. The Nme at which a consumer becomes contractually obligated on a credit transacNon D. The Nme at which a lender becomes contractually obligated to the consumer When a homeowner allows his/her insurance to lapse, what can the lender do to insure the property? A. Force-placed insurance B. OpNonal credit life UTAH PRACTICE EXAM – QUESTIONS C. State-placed insurance D. Mortgage insurance The DRE will not issue a license if the applicant: A. Does not have a licensed control person B. Is a licensed mortgage loan originator C. Was convicted of a misdemeanor ten years ago D. Does not have a sponsor Sexual harassment violates Title VII of the: A. Civil Rights Act of 1964 B. Equal Work Environment Act of 2004 C. Safe Employment Opportunity Act of 2008 D. Equal Credit Opportunity Act of 1976 A nontradiNonal mortgage product is deﬁned as: A. Any product other than a 30-year ﬁxed-rate mortgage loan B. A high-cost mortgage loan C. Any product without an adjustable rate D. Any product other than a ﬁxed-rate mortgage loan Members of the ResidenNal Mortgage Regulatory Commission are appointed by the ___________ with the approval of the ____________: A. Governor; Director B. Director; AYorney General UTAH PRACTICE EXAM – QUESTIONS C. Director; Governor D. AYorney General; Director A mortgage loan originator whose license is revoked in another state: A. Must noNfy the DRE within ten business days B. Must noNfy the DRE immediately C. Must noNfy the DRE within seven days D. Must noNfy the DRE within 30 days A qualiﬁed mortgage is one that meets all of the following standards, except: A. A DTI raNo of 43% or less B. A term of 30 years or less C. An LTV raNo of 65% or less D. Points and fees of no more than 3% In Utah, employment is: A. At will B. By independent contract only C. Through wriYen contract only D. For cause For which of the following does rescission not exist? A. A purchase of a principal residence with a convenNonal loan B. A reﬁnance in which a husband has requested a rescission waiver without his wife’s signature C. Opening a home equity line of credit UTAH PRACTICE EXAM – QUESTIONS D. A reﬁnance of a principal residence This informaNonal disclosure is due to the consumer no later than three business days aTer receipt of a completed applicaNon for a mortgage loan: A. CHARM Booklet B. HECM Booklet C. Closing Disclosure D. Your Home Loan Toolkit: A Step-by-Step Guide A lender who refuses to originate loans in a parNcular neighborhood or zip code because of the perceived creditworthiness of consumers living in the area is in violaNon of: A. FCRA B. RESPA C. HOEPA D. ECOA The amount of income leT over aTer debt is subtracted is called: A. DiscreNonary spending B. Residual income C. Debt raNo D. Debt inverse The raNo of the total balance of all mortgage liens against a property to the total property value is called: A. TLTV B. HLTV C. LTV UTAH PRACTICE EXAM – QUESTIONS D. CLTV A loan with a term of less than one year that is related to the purchase or construcNon of a home is known as: A. A subprime loan B. A nontradiNonal loan C. A balloon mortgage D. A bridge loan The Loan EsNmate must be provided at least _________________ prior to consummaNon. A. One business day B. Seven business days C. Ten business days D. Three business days What type of mortgage loan creates a presumpNon that the loan complies with ability-to-repay standards? A. Balloon mortgage B. Fixed-rate mortgage C. Reverse mortgage D. Qualiﬁed mortgage Qualiﬁed mortgages are beneﬁcial because: A. They come with a presumpNon of compliance that the borrower meets ability to repay standards B. They are guaranteed not to result in lender loss through default or fraud C. They are backed by the government UTAH PRACTICE EXAM – QUESTIONS D. They likely result in higher commissions for the mortgage loan originator High-cost loans are covered under which federal law? A. HOEPA B. HMDA C. ECOA D. RESPA Why are FHA loans beneﬁcial to lenders? A. They are only made to low-income borrowers B. They are insured by the federal government C. They do not require escrows or other complicated accounNng D. They do not require down payment When a lender is forced to go before a judge to enter an order of foreclosure, it is referred to as: A. AcceleraNon B. Power of sale C. Non-judicial foreclosure D. Judicial foreclosure Which threshold cannot be used to idenNfy high-cost loans according to federal law? A. APR threshold B. Points and fees threshold C. PMI threshold D. Prepayment penalty threshold UTAH PRACTICE EXAM – QUESTIONS The FILOLA applies to: A. Employees or agents of depository insNtuNons B. Licensed PLMs C. Loan processors and underwriters working for licensed mortgage professionals D. Employees or agents of non-depository insNtuNons The Gramm-Leach-Bliley Act is concerned with: A. Privacy of consumer informaNon B. Inappropriate charging of fees C. Mortgage fraud and money laundering D. Honesty in adverNsing An applicant for a lending manager license must meet experience requirements, including three years of experience originaNng residenNal mortgage loans and evidence of having originated: A. At least 15 ﬁrst lien residenNal mortgages B. At least 30 ﬁrst lien residenNal mortgages C. At least 45 ﬁrst lien residenNal mortgages D. At least 50 ﬁrst lien residenNal mortgages MIP would be used for which of the following? A. A non-conforming loan B. VA loan with less than a 10% down payment C. An FHA loan with a 3.5% down payment D. A convenNonal loan with a down payment of less than 20% UTAH PRACTICE EXAM – QUESTIONS The ____________________ looks at the amount of a borrower’s gross monthly income that will go toward his or her indebtedness, including mortgage-related expenses. A. Debt-to-asset raNo B. Front-end raNo C. Loan-to-value raNo D. Back-end raNo

Utah Practice Exam - Questions PDF

Document Details

Tags

Related

Summary

Full Transcript

Upgrade to continue