Appendix B: Sample Test Questions

Sample Test Questions

1. Included in the Loan Estimate, all of the following are part of the finance charge except the:
   1. appraisal cost.
   2. VA funding fee.
   3. per diem interest.
   4. origination charges.
2. A buyer has made an earnest money payment of $5,000. The buyer pays an additional $2,000 in option money to be credited at closing on a property with a sale price of $160,000. If the required down payment is 20%, how much additional money will the buyer need to provide toward the down payment at closing?
   1. $25,000
   2. $27,000
   3. $30,000
   4. $32,000
3. If an applicant works 40 hours every week and is paid $13.52 per hour, what is the applicant’s monthly income?
   1. $2,163.20
   2. $2,343.47
   3. $2,379.52
   4. $2,487.68
4. The requirement for private mortgage insurance (PMI) is generally discontinued when the loan-to- value ratio falls below:
   1. 20%.
   2. 50%.
   3. 80%.
   4. 90%.
5. The unique identifier of any person originating residential loan must be clearly shown on all of the following documents except:
   1. business cards.
   2. company websites.
   3. residential mortgage loan application form.
   4. Consumer Financial Protection Bureau (CFPB) special information booklet.
6. According to the Truth-in-Lending Act (TILA), the term “refinance” applies to:
   1. a reduction in APR.
   2. a change in a payment schedule.
   3. the renewal of a single payment obligation with no change in the original terms.
   4. the satisfaction of an existing obligation and its replacement by a new obligation.
7. Which of the following documents does a mortgage loan originator use to determine the estimated value of a property based on an analytical comparison of similar property sales?
   1. An appraisal
   2. An area survey
   3. A market survey
   4. A cost-benefit analysis
8. According to the Equal Credit Opportunity Act (ECOA), age discrimination by a mortgage lender is acceptable:
   1. not under any circumstance.
   2. only if the applicant is too young to enter into a legally binding contract.
   3. only if life expectancy data indicates an applicant will not be alive at the end of the loan term.
   4. only if the applicant is too young or too old to understand the ramifications of defaulting on a legal debt.
9. When a client’s property is being appraised, a loan underwriter may take all of the following actions except:
   1. request a second review of the appraisal.
   2. ask the appraiser to consider additional property information.
   3. ask the appraiser to correct an incidental error on the appraisal.
   4. inform the appraiser that the appraised value is contingent on the client’s retention of the principal dwelling.
10. According to the Truth-in-Lending Act (TILA), which of the following fees is excluded from the calculation of the APR?
    1. Wire transfer
    2. Prepaid interest
    3. Hazard insurance
    4. Mortgage insurance premiums