Exam (elaborations)
RMLO Quiz 2 & Quiz 3: Questions With Correct Solutions
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RMLO Quiz 2 & Quiz 3: Questions With Correct Solutions
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RMLO Quiz 2 & Quiz 3: Questions With CorrectSolutions
RMLO Quiz 2
Qualifying income ratio guidelines on an FHA loan are Right Ans - 31%
housing ratio and 43% total debt ratio
A mortgage loan originator must provide the loan Estimate to the consumer
Right Ans - No later than third business day after the creditor received the
consumer's application for a mortgage loan
Which act amended the Truth in lending act, establishing disclosure
requirements and prohibiting equity stripping and other abusive practice in
connection with high-cost mortgages? Right Ans - Home Ownership and
Equity Protection (HOEPA)
A borrower obtains a 1 year adjustable rate loan with a 2.25% margin, 1% per
adjustment cap, and a start rate of 3.5%. The index on the loan at the
adjustment is after first 12 months, the index is 2%, after 24 months, the index
is 3.17%, and at 36 months, the index is 4.14%. What wil be borrower's
interest rate be at 37 months into the loan? Right Ans - 6.25%. Explanation:
Start Rate 3.5 % 1% cap 12 mths - index 2 + 2.25 argin = 4.25%. Start rate
3.50% +1% cap = 4.5% - buyer gets 4.25% 24 mths index 3.17 +2.25 = 5.42% -
current rate 4.25 + 1% cap = 5.25% - buyer gets 5.2536 mths index 4.14 +
2.25 = 6.39% - current rate 5.25 % + 1% cap = 6.25% - buyer gets 5.26%
A lender who does not cancel PMI when the LTV reaches 78% is in violation of
which federal law? Right Ans - Homeowners Protection Act
The Patriot Act requires non bank mortgage lender to implement all the
following actions except Right Ans - Develop a red flag program that
identities all mortgage loan application involving foreign nationals.
Under which federal legislation does the consumer have the right to receive a
copy of the appraisal report on a dwelling that is to be used as collateral for a
loan? Right Ans - ECOA
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