CRCM Exam Flashcards Questions And Answers
With Latest Study Solutions
Regulation B—Applicant ANS An applicant is any person who asks for or receives credit from a creditor.
The term includes any person who is or may become contractually liable for an extension of credit, including a
creditor required co-signer The term also includes guarantors, sureties, endorsers, and similar parties
Fair Lending - Credit transaction ANS For purposes of fair lending rules, "credit transaction" covers every
aspect of an applicant's dealings with the creditor, from the application through pay-off or collection.
Regulation B—Age Discrimination ANS There are special rules and protections for elderly applicants—
those age 62 or older. As long as applicants 62 or older are treated at least as favorable as applicants younger
than 62, age discrimination has not occurred
Regulation B— Marital Status ANS Marital status can be considered in only three ways. The applicant is
Married Separated, or Unmarried (divorced, never-been-married, or widowed)
Regulation B - Required Information to Request and Document ANS Monitoring information is required
when the loan is primarily to purchase or refinance a dwelling that is occupied or to be occupied by the
applicant as their principal residence and the loan will be secured by the dwelling. Additionally, a creditor that
is a financial institution under Regulation C (12 C.F.R. 1003.2(g)) may collect applicant ethnicity, race, and sex
information on loans secured by a dwelling in accordance with Appendix B of HMDA that are not exempt
under 1003.3(c)(11) or 1003.3(c)(12).
Reg. B - Marital Status and Marital Income ANS 1. When the applicant applies for individual unsecured
credit, you may not ask the applicant's marital status unless the applicant resides in a community property state
or is relying on property located in such a state.
2. Do not ask whether the applicant receives marital income (alimony, child support, separate maintenance)
unless and until they are notified that they need not reveal such income unless relying on it to qualify for credit
Reg. B - Information Essential for Underwriting the Loan ANS Some information that could appear to be
discriminatory is allowed because it is essential for underwriting the loan application.
1. All liabilities, including accounts which the applicant holds or has held in another name
2. how many dependents he/she/they have
3. Applicant's immigration status—but only to determine the applicant's legal status in this country and our
legal remedies, should we need them These questions are allowed if we ask all applicants for the same
information and we do not seek or use the information in a discriminatory way.
,Reg. B - Age ANS 1. We may consider age to favor an elderly applicant (age 62 or older).
2. We may consider the applicant's youth—especially for the ability to enter into a legally binding contract.
3. We may NOT use statistics to estimate the applicant's life expectancy—no matter how old they are.
4. We may NOT base our credit decision on availability of credit life, health, accident, disability or other
credit-related insurance.
Reg B - Applications for Joint Credit ANS When taking applications from unmarried co-applicants,
creditors must treat them the same way they treat married co-applicants. When two people apply for credit,
creditors consider the combined income, assets and debts in the same way whether the applicants are married
to each other or not
Reg B - Signature Rules, Secured Credit ANS If the applicant requests secured credit, we must not ask for
or request the signature of the applicant's spouse unless we need the signature to perfect our security interest.
In this case, we may only require the spouse's signature on instruments needed to perfect security.
Reg. B - Timing Requirements ANS The lender must send the notice in the following timeframe:
1. Within 30 days of receiving a completed application or taking adverse action on an incomplete application 2.
Within 90 days of a counter-offer if the applicant did not accept it
Reg. B - Notice of Action Taken, Required Information ANS The following information must be included
in the adverse action notice:
1. Creditor name, address, and contact information
2. The type of action taken on the application
3. The reasons for adverse action, or a statement that the applicant has the right to obtain reasons
4. Up to four principle factors or reasons from the consumer's application that caused the denial
5. A statement of the applicant's credit rights under the Equal Credit Opportunity Act
6. Name and address of the federal agency that administers compliance for the creditor
Reg. B - Special Rule for Business Loan Applications ANS For businesses with gross revenues of <
$1,000,000, you may give the applicant a statement of action taken orally—it need not be in writing. For
businesses with gross revenues in excess of $1,000,000 you may still give the applicant an oral notification,
however, the notification must be within a reasonable time of making the decision. If the applicant requests a
written notice of action within 60 days of the oral notification, you must provide a written notice of the action
taken.
,Reg. B - Record Retention ANS 1. The basic record retention rule is 25 months from the date you notify
the applicant of your decision.
2. Records for credit applications from small businesses need only be retained for 12 months.
3. If the business has annual gross revenues in excess of $1 million, your records retention period is 60 days
after notification. However, if the applicant requests in writing the reasons for adverse action or that records be
retained, the retention period is 12 months.
4. Records for any type of credit must be retained beyond these limits if there is a court or regulatory agency
order to retain these records longer.
Reg. B, Are creditors required to ask for monitoring information if an applicant mails an application to their
financial institution? ANS No. Creditors must ask for monitoring information (applicants' race, ethnicity,
and gender for mortgage loan applications) whenever they have personal contact with the customer. This
includes applications taken face-to-face and applications taken by telephone
Which two regulations require the creditor to obtain monitoring information on certain mortgage-related credit
applications? ANS Regulation B and Regulation C
For which two mortgage-related loans must the creditor collect the monitoring information under Regulation
B? ANS 1. Loan for purchasing a principal residence secured by that dwelling
2. Loan for refinancing a principal residence secured by that dwelling
Reg.B - Appraisal Requirements ANS Creditors shall provide an applicant a copy of all appraisals and
other written valuations developed in connection with an application for credit that is to be secured by a first
lien on a dwelling.
Reg. B - Appraisal Requirements, Dwelling definition ANS Dwelling means a residential structure that
contains 1-4 units whether or not that structure is attached to real property. Dwelling includes, but is not
limited to, a condominium or cooperative unit, and a mobile or other manufactured home
Reg. B - Appraisal Disclosure Timing requirement ANS A creditor shall mail or deliver to an applicant, not
later than the 3rd Business day after the creditor receives an application for credit that is secured by a first lien
on a dwelling, a written notice of the applicant's right to receive a copy of all written appraisals developed in
connection with the application
, Reg. B, Which three statements covering self-test privilege rules are correct? ANS 1. Privilege requires
that the creditor perform appropriate corrective action when the self-test identifies violations
2. The privilege is lost is anyone in the institution voluntarily discloses test information
3. The privilege is lost if the creditor fails to comply with the recording keeping requirements for Regulation B
FCRA, Investigative Report ANS A special type of consumer report in which information about a
consumer's character, general reputation, personal characteristics, and mode of living is obtained through
personal interviews.
Consumer Report, Stale Information Timing ANS A consumer report for credit transactions cannot
generally include stale information, which is information older than seven years. Bankruptcies can be reported
for ten years.
What is important to remember about seven years and ten years regarding credit report information? ANS
Bankruptcies can be reported for ten years. All other adverse items, with very limited exceptions, may be
reported for seven years. This keeps information recent and reliable.
Considering the nine FCRA specific exceptions for using medical information in the context of evaluating a
credit decision, which scenario is permissible? 1. Determining if the consumer qualifies for special credit
program or credit related assistance 2. Making a decision in financing medical products or services 3. Upon a
specific request to use medical information 4. Determining a consumer's eligibility for triggering or
reactivating a debt cancellation or suspension agreement if a medical trigger ANS All are permissible
FCRA, Medical Information Exceptions ANS Medical information can be obtained and used in a credit
decision under the following exceptions: Determining legal capacity Complying with applicable legal
requirements Determining if consumer qualifies for special credit program or credit related assistance
Detecting or preventing fraud Making a decision in financing medical products or services Upon specific
request to use medical information Determining if a forbearance practice or program is triggered by a medical
condition or event Determining consumer's eligibility for triggering or reactivating a debt cancellation or
suspension agreement Determining consumer's eligibility for triggering or reactivating a credit insurance
product
Exception Hold reasons ANS An exception is a reason to delay availability longer than what Reg. CC
availability says. 1) New Account 2) Large Deposits 3)Checks that are re-deposited 4) Repeated overdrafts 5)
Emergency conditions 6) Reasonable Cause
Reasonable Cause ANS You have a reasonable suspicion as to the validity of the check
