Mortgage Loan Originator Origination Activities

1.Naomi gives her name, her monthly income, her Social Security number, the property address, and an estimated value. She has not said how much she wants to borrow. What is true about the Loan Estimate clock?

2.Hector gives his name, his income, his Social Security number, the property address, and the loan amount he wants. He gives no estimate of what the home is worth. What is still missing before the Loan Estimate clock starts?

3.Priya provides her name, income, Social Security number, a value estimate, and the loan amount sought. She is still choosing between two streets and has not named a property. What is true?

4.Malik sends his name, Social Security number, the property address, a value estimate, and the amount he wants to borrow. He says he would rather not discuss pay until a later meeting. What is still missing?

5.Elena gives her name, her income, the property address, a value estimate, and the loan amount sought. She says she will bring her Social Security number to an open house next weekend. What is true today?

6.Grant's sister emails his income, Social Security number, the property address, a value estimate, and the loan amount sought. The message never gives the borrower's name. What is true?

7.On Wednesday, Sylvia's file first contains her name, income, Social Security number, property address, value estimate, and loan amount sought. None of that set was complete on an earlier day. When does the Loan Estimate clock start?

8.On Monday Owen sends his name, income, Social Security number, a value estimate, and the loan amount sought. The property address arrives by email on Thursday, and nothing is missing after that. When does the Loan Estimate clock start?

9.On Friday Beatrice has already given her name, income, Social Security number, property address, value estimate, and loan amount sought. She has not said she intends to proceed. A coworker says the Loan Estimate clock waits for that statement. What is true?

10.Carmen is a wage earner at a firm the originator can call. She offers a business card and says she earns $6,200 a month. She has no paystubs with her. What should the originator collect before treating that income as verified?

11.Derek has been self-employed for six years and wants that income counted. He offers one month of bank deposits and no tax returns. What belongs in the file before the income is treated as verified?

12.Aisha's last two bank statements show her regular paycheck and one $9,400 deposit she cannot explain. She wants the full balance counted as funds to close. What should happen to the $9,400?

13.Lionel's written verification of employment was satisfactory last month. The day before closing, the employer tells the originator that Lionel was laid off yesterday. What is the status of his employment?

14.Fatima is salaried. The file has paystubs for the past month, W-2 forms for the prior two years, and the employer's confirmation that she is still working. There is no employment gap. What is true?

15.Hugo opened his consulting business four months ago. He has no earlier self-employment. He offers a one-page projection of next year's receipts and asks to be qualified on that projection. What is the right treatment?

16.Ingrid is self-employed. Her tax returns show net profit of $54,000 and $51,000 for the last two years. She asks to be qualified on $80,000 because she expects a new contract. What income should be used?

17.Patrick's only asset record is a bank statement dated eight months ago. The same account is still open, and he can download current statements. What should the originator require before counting the balance?

18.Rosa and her brother are both named on a savings account. Only Rosa is applying. The statements show his name, and she cannot show that she is allowed to withdraw the money. What should the originator do with that balance?

19.Victor has one tri-merge credit report with scores of 704, 718, and 731. The lender uses the middle of the three scores as his representative score. Which score is used?

20.Wendy's tri-merge report shows an inquiry from Harbor Autos 20 days ago. She confirms she signed a new car loan with a $310 monthly payment, and that loan is not on the report yet. What must be done with the $310?

21.Caleb has a car loan with 24 payments of $415 left, a credit card with a $40 minimum payment, and a $90 monthly cell phone bill. Which of these must be counted as debts?

22.Denise pays $625 a month in child support under a court order with three years remaining. She asks to leave it off her debts because it is not a loan from a bank. What is the correct treatment?

23.Amir co-signed an auto loan. The payment is $375 a month. He has paid it from his own account for the last 14 months, and the primary driver does not pay it. What payment is counted?

24.Lila's tri-merge report is in the file. She also hands over a store-card statement with a $55 minimum payment that does not appear on the report. What should the originator do?

25.Oscar's tri-merge scores are 690, 706, and 712. His co-borrower Nia's scores are 668, 674, and 701. The lender takes each person's middle score, then the lower of those two middle scores. Which score is used for the loan?

26.Tanya has a $280 monthly installment payment with 11 payments left. She wants it removed because she plans to pay the loan off someday. She has not paid it off, and no payoff is in the file. What is the correct treatment?

27.Felix has an inquiry from North Bridge Card dated 12 days ago. He says he was approved for a new card with a $70 required minimum payment. That card is not on the tri-merge report yet. What is true?

28.Marisol's refinance works only if the home appraises for at least $420,000. She asks the originator to tell the appraiser that $420,000 is the number the loan needs. What may the originator do?

29.Ethan believes the appraisal missed a nearby sale that closed last week. He has the closed sale's address and price, and he wants a reconsideration. What may the originator request?

30.Keisha's borrower offers to choose an appraiser who will help the value, and to pay that appraiser directly if the number comes in high enough. What should the originator do?

31.Roland has an invoice showing the property got a new roof last month. The appraiser has not asked for a target value, and Roland does not have one to send. What may he provide?

32.Yara's purchase contract price is $385,000. She tells the originator to call the appraiser and say to come in at $385,000 so the loan can close. What is the originator's response?

33.The opinion of value is $15,000 below what Simon's borrower hoped. The borrower asks Simon to threaten a board complaint unless the appraiser raises the number by $15,000. What should Simon do?

34.Bridget is ready to order the appraisal. A coworker says to hint that the file needs $510,000, but not to write the number in the email. What should Bridget do?

35.Andre's appraiser asks whether the borrower wants a particular value. Andre knows the cash-out refinance works only at $275,000 or higher. What is an appropriate reply?

36.Celeste disagrees with the value. She has no new comparable sale, no corrected property fact, and no error to point out. She wants the originator to keep calling until the number goes up. What should the originator do?

37.Darius is refinancing into a new first mortgage. Title shows his current mortgage, which will be paid, and a judgment lien of $6,200. He wants the judgment left on title. What is required for the new loan to record as a clear first lien?

38.Fiona is buying a home. The title commitment lists a mechanic's lien from a kitchen contractor the seller did not pay. The seller says the lien is old and should be ignored. What should happen at closing?

39.Hassan's hazard policy expires two days before closing. The lender requires insurance in force on closing day, with the lender named on the policy. He has a quote he has not accepted. What is required before closing?

40.Julia is buying a home with a new first mortgage. She asks to skip homeowner's insurance to save the premium. The lender requires hazard coverage. What is the result?

41.Miles is refinancing. Title shows property taxes that became a lien. He believed the taxes were current. The new loan is supposed to be in first position. What is the effect on closing?

42.Nadine's lender requires a lender's title policy. She asks who that policy protects. What is the accurate answer?

43.Pablo closes on Tuesday. His homeowner's policy is in force, but the dwelling limit is $90,000. The lender requires coverage of at least the $240,000 replacement figure in the file. What must happen?

44.Quinn's refinance was approved to pay off a $188,000 first mortgage and a $14,000 second mortgage, leaving the new loan in first position. The second lien is missing from the payoff list. What is missing?

45.Irene is quoted $1,140 for an owner's title policy and $860 for a lender's title policy. She asks which one protects her ownership rather than the lender's lien. Which policy is that?

46.Seth has not locked a rate. The quoted rate today is 6.25 percent, and it was 6.00 percent last week. He is still floating. What is true?

47.On March 1 Alma locks 6.125 percent for 30 days. The lock expires March 31. Closing is scheduled for March 20. If she closes on March 20, what rate does the lock agreement give her?

48.Boris locked 6.50 percent through April 10. Closing was delayed to April 18. The lender has not granted an extension. What is true of the 6.50 percent on April 18?

49.Clara's lock expires on Friday. The lender will extend it 7 days for a fee of 0.125 percent of the loan amount. She declines the fee and does not extend. Closing moves to the next Wednesday. What happens to the locked rate?

50.Damon is floating. He asks the originator to promise today's 6.375 percent for a closing 40 days away, with no lock agreement. What can the originator promise?

51.Esther locked 6.00 percent for 45 days. Fifteen days later the market rate on the same loan is 5.75 percent. Her lock agreement has no float-down. What rate does the lock give her?

52.Gavin locked 6.25 percent for 20 days. On day 12 an underwriting condition is still open. He assumes the lock means the loan is approved. What is true?

53.Holly's lock expired yesterday. It had been 6.250 percent. The lender's relock quote today is 6.625 percent. She wants the expired rate restored with no new lock. What can she count on?

54.Ivan locks 6.875 percent for 15 days on a Friday. The lock expires on the Friday two weeks later. Closing is moved to the Monday after that expiration, and he does not extend. What should the originator tell him?

55.June's Loan Estimate was for a single-family house. She later switches the property to a condominium, and the lender requires a condo questionnaire fee that did not apply to the house. May the lender revise the Loan Estimate to add that fee?

56.Karl's Loan Estimate left off the lender's standard $995 underwriting fee. That fee is charged on every loan from this lender, and nothing about Karl's loan has changed. The originator wants a revised Loan Estimate that adds the $995. Is that allowed?

57.Leila's Loan Estimate was issued while her rate was floating. She later locks, and the lock carries a lock fee that was not on the floating estimate. May the lender issue a revised Loan Estimate for the lock?

58.Martin's Loan Estimate was priced on a credit score of 740. His tri-merge report shows 690. The lender's price sheet, already in use, charges more at 690 than at 740. May the lender revise the Loan Estimate for that pricing difference?

59.Nora already locked her rate, and the lock has not expired. Wholesale rates later rise. Nothing about her loan, property, or credit has changed. The lender wants a revised Loan Estimate that worsens her locked rate. May it?

60.Omar's Loan Estimate assumed one borrower. His sister will now apply with him, and the file needs her credit report. That report changes the credit-report fee that was disclosed. May the lender revise the Loan Estimate for the new fee?

61.After Paula's Loan Estimate, a storm damages the county and the lender now requires a new inspection. The inspection fee did not exist when the estimate was issued. May the lender revise the Loan Estimate to include it?

62.Ruben asks whether rates might be lower next month. He does not change the loan amount, the program, the property, the occupancy, or the lock. No new credit or property information has arrived. May the lender revise the Loan Estimate to increase his origination charge?

63.Thea's appraisal is lower than the value used on her Loan Estimate. She asks to reduce the loan amount so the loan still fits the lender's maximum loan-to-value limit. The county transfer tax depends on the loan amount and changes with it. May the lender revise the Loan Estimate for the new amount and that tax?

64.Uma's gross monthly income is $6,000 and her take-home pay is $5,000. Principal and interest are $1,200, property taxes are $300, and insurance is $300. She also pays $600 a month on a car. What is her front-end housing ratio?

65.Wesley's gross monthly income is $8,000 and his take-home pay is $7,000. His housing payment is $2,000. He pays $400 on a car, a $200 credit-card minimum, and $200 on a student loan. What is his back-end total debt ratio?

66.Ximena's gross monthly income is $4,000 and her take-home pay is $3,000. Her mortgage payment is $1,000, and $200 of homeowners association dues count as part of the housing payment. She also pays $200 a month on a car. What is her front-end housing ratio?

67.Yves's gross monthly income is $10,000 and his take-home pay is $8,000. His housing payment is $2,500. He pays $500 of alimony, a $500 car payment, and a $500 credit-card minimum. What is his back-end total debt ratio?

68.Zara's gross monthly income is $4,800 and her take-home pay is $3,600. Her housing payment is $1,440, including $240 of insurance. She also pays $240 a month on a personal loan. What is her front-end housing ratio?

69.Arthur's gross monthly income is $9,000 and his take-home pay is $7,200. His housing payment is $2,250. He pays $450 for a car, $450 on a student loan, and a $450 credit-card minimum. What is his back-end total debt ratio?

70.Bianca's gross monthly income is $3,000 and her take-home pay is $2,500. Her housing payment is $900, of which $600 is principal and interest and $300 is taxes and insurance. She pays $300 a month in child support. What is her front-end housing ratio?

71.Conrad's gross monthly income is $12,000 and his take-home pay is $10,500. His housing payment is $3,000. He pays $600 on a car, a $300 credit-card minimum, and $300 on a personal loan. What is his back-end total debt ratio?

72.Dahlia and Neil are both borrowers. Her gross monthly income is $4,000 and his is $2,000. Their housing payment is $1,800, including $1,500 of principal and interest and $300 of taxes and insurance. They pay $600 a month on a car. What is the front-end housing ratio?

73.After paying cash to close, Edgar will have $28,000 left in liquid accounts. His monthly principal, interest, taxes, and insurance total $2,000. He has no other reserve asset. How many months of PITI reserves does he have?

74.Farah's loan allows gift funds. Her aunt can document $12,000 in the aunt's own account and will wire it to the closing agent, with a gift letter. Farah also offers to bring $12,000 in cash that has no paper trail. What meets the paper-trail requirement?

75.George has $45,000 in checking. Cash to close is $15,000. Monthly principal and interest are $2,000, taxes are $300, and insurance is $200. He has no other liquid funds. How many months of full PITI remain as reserves after closing?

76.Hana's loan allows gift funds from a parent. Her father will provide $8,000 only if she repays him $200 a month. She wants the $8,000 listed as a gift. What is the correct treatment?

77.Isaac has $9,600 left after closing. Monthly PITI is $1,600. He also has a retirement account he is not allowed to withdraw. How many months of PITI reserves does the $9,600 represent?

78.Joelle's loan allows gift funds. Her cousin wired $6,500 into Joelle's account. The file has the cousin's statement showing the money leave, the incoming wire, and a gift letter stating that Joelle does not have to repay it. What should the originator do?

79.Kenneth can use $22,000 in savings and $6,000 in checking. Cash to close is $4,000, paid from these accounts. Monthly PITI is $2,000, and he has no other liquid funds. How many months of reserves remain after closing?

80.Lucia's loan allows gift funds. Her uncle will bring a $10,000 check from his account to closing. He can sign a gift letter, and the closing agent can keep a copy of the check. Lucia also typed an unsigned note that says the money is probably a gift. What is sufficient?

81.Mateo has $12,000 left after cash to close. Monthly principal and interest are $900, taxes are $300, and insurance is $300. The lender counts full PITI, and he has no other reserve asset. How many months of reserves does he have?

82.Nell's automated findings say approve, and they still list a verbal verification of employment. That verification is not back. She asks to schedule closing for tomorrow. What is true?

83.Otis receives a refer from automated underwriting. He asks the originator to treat the refer as a denial and shred the file. This lender sends referred files to a human underwriter. What is the right next step?

84.A manual underwriter granted Petra an exception for a short job gap. A separate condition, sourcing a $7,000 deposit, is still open. She says the exception cleared the whole file. What is true?

85.Rafael's automated findings used $4,800 of monthly income. His paystubs support $4,200. He asks the originator to leave the old findings in place. What should happen?

86.Sable asks the originator to waive an appraisal condition the underwriter left open. She says the contract price is close enough to make the appraisal unnecessary. What may the originator do?

87.Tomas has a current automated approval. A prior lender once wrote a manual-exception comment on a different loan. This lender has not approved any exception. He asks the originator to paste that old comment onto this file and call it cleared. What is the right response?

88.Ursula's findings are an approval with three conditions. Two are cleared. The gift-letter condition is still open, and her loan allows gifts only when that letter is in the file. The letter is not in the file. She asks to fund today. What should the originator say?

89.Vince's commission income has a short history, so the loan does not receive an automated approval. An underwriter will review it manually. He asks to drop the commission records because a person, not a computer, is reading the file. What is true?

90.Willa's automated findings say the loan is eligible, and they list homeowner's insurance as a condition. No binder is in the file. A coworker says the word eligible means the condition can be ignored. What is the status?

91.Xavier is refinancing the house he lives in as his primary residence. He signs on Monday, receives the rescission disclosures that day, and does not cancel. No holiday is involved. When may this refinance fund?

92.Yolanda is refinancing her primary residence. On day 2 of the 3-business-day period she delivers a written cancellation. An hour later she phones and says she has changed her mind and wants the loan. What has to happen?

93.Zachary is buying the house he will live in. It is a purchase, not a refinance. He asks the closer to hold funding for 3 business days under the primary-residence refinance rule. What is true?

94.Ada is refinancing a beach house she uses on vacations. She lives in an apartment in another city, and this loan does not encumber the apartment. She asks for 3 business days to cancel, the way a primary-residence refinance would. What is true?

95.Bennett refinances his primary residence and signs on Friday. He gets the rescission notices that same day. For this count, Saturday is a business day, Sunday is not, and no federal holiday falls in the period. He does not cancel. Which day is the third business day?

96.Cora and Dominic both own the home and both live in it. Both are on a primary-residence refinance. On day 2 of the 3-business-day period, Cora cancels in writing. Dominic wants the loan to fund. What is the result?

97.Elise refinanced her primary residence and received the rescission notices at signing. The 3-business-day period ended on Thursday and she did not cancel. The loan then funded. On the next Tuesday she asks to use that same 3-day right to unwind it. What is true?

98.Franklin is refinancing a rental house. He has never lived there. His primary residence is a different property and is not collateral for this loan. He tells the closer to delay funding for 3 business days under the primary-residence rule. What should the closer understand?

99.Greta is refinancing her primary residence. Her rate lock expires at noon on day 1 of the 3-business-day rescission period. She has not canceled. The originator wants to fund that morning so the lock does not expire. What is allowed?

100.Gina closed last week. Her interest rate and payment stay the same, but servicing of the loan transfers to another company on the first of next month. A coworker says no notice is required because the rate did not change. What is true?

101.Harvey's servicing transferred on June 1. His notice states that for 60 days after June 1, a payment that reaches the old servicer on time is not treated as late. On June 10 he sends that regular payment, on time, to the old servicer. What is the result?

102.After closing, Iris receives a servicing-transfer notice. It names the new servicer, the date the transfer starts, and the address for later payments. She asks if she can throw it away because she already knows her interest rate. What should she be told?

103.Jonah qualifies. His friend, who will live in the house and make the payments, does not. The friend offers Jonah $4,000 to apply as an owner-occupant and turn over the keys after closing. Jonah will not live there. What should the originator do?

104.Kira earns $3,400 a month. Her manager tells the originator to type $5,200 so the debt ratios will pass, and to fix the paystub later if anyone asks. Kira agrees. What should the originator do?

105.Lawrence's bank statement in the file shows a balance of $2,100. A broker then hands over a scanned copy that shows $22,100, and Lawrence says he edited the picture to add a digit. What should the originator do?

106.Mina will sign the note, but a coworker of the seller will move in and make every payment. Mina is offered $1,500 to sign, and she has not seen the house. The coworker says to put Mina down as the buyer. What is this file?

107.After closing, Nathan receives a notice that servicing transfers on the 15th. The notice describes a 60-day period, starting on that date, during which an on-time payment to the old servicer is not treated as late. He asks what the notice is for. What is the accurate answer?

108.Ophelia tells the originator she will rent the house to a tenant she has already chosen, and that she will not live there. She then asks the originator to mark the application owner-occupied so the rate will be lower. What should the originator do?