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| Section | Weight | Objectives |
|---|---|---|
| Topic 1: Ethics | 18% | - Ethical practices and professional conduct - Fair lending and anti-discrimination - Conflict of interest and disclosure obligations - Fraud prevention and detection |
| Topic 2: Mortgage Loan Origination Activities | 27% | - Loan programs and product types - Closing and post-closing procedures - Loan application process - Borrower qualification and underwriting basics |
| Topic 3: Federal Mortgage-Related Laws | 24% | - Fair lending and consumer protection rules - SAFE Act and federal regulatory framework - TILA, RESPA, ECOA, HMDA, FCRA - Disclosure requirements and timing |
| Topic 4: Uniform State Content | 11% | - License maintenance and renewal - State licensing and regulatory requirements - Compliance and disciplinary standards |
| Topic 5: General Mortgage Knowledge | 20% | - Conventional, FHA, VA, USDA loan characteristics - LTV, DTI, CLTV, PMI, points and fees - Mortgage terms, concepts and calculations - Fixed-rate vs adjustable-rate mortgages |
1. Which of the following fees is a finance charge?
A) Appraisal fees
B) Title insurance
C) Discount points
D) Pest inspection fees
2. A revised Closing Disclosure is not required to be provided before a loan consummation in which of the following circumstances?
A) An addition of an escrow account
B) An addition of a prepayment penalty
C) A change in APR
D) A change in loan product
3. Which of the following is an example of a non-fluctuating income source?
A) Salaried W-2 position
B) Self-employed income
C) Part-time work with irregular hours
D) Commission-based W-2 income
4. Which of the following federal laws requires disclosures intended to prevent lenders or mortgage loan originators (MLOs) from increasing fees during the origination process?
A) Truth in Lending Act (TILA)
B) Equal Credit Opportunity Act (ECOA)
C) Real Estate Settlement Procedures Act (RESPA1)
D) Home Mortgage Disclosure Act (HMDA)
5. Redlining in mortgage lending refers to which of the following practices?
A) Denying services to residents in states that a company is not licensed in
B) Highlighting areas of concern on an appraisal report
C) Denying services to residents of a certain area based on race or ethnicity
D) Highlighting areas of concern on a mortgage application
Solutions:
| Question # 1 Answer: C | Question # 2 Answer: A | Question # 3 Answer: A | Question # 4 Answer: C | Question # 5 Answer: C |
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Mortgage Loan Origination (SAFE MLO) Exam
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