Ethics

Question 1

For a licensed mortgage professional, paying compensation for referrals is:

Answer 1

Unethical, and a violation of federal law

Question 2

Federal law enacted with intent to make it easier to prosecute mortgage fraud

Answer 2

Fraud Enforcement and Recovery Act

Question 3

Mishandling and/or improperly managing a borrower’s funds is a practice prohibited by

Answer 3

RESPA

Question 4

a person used to buy property and conceals the identity of the actual owner because they cannot qualify is called a

Answer 4

straw buyer

Question 5

Red Flags Rule falls under

Answer 5

FACTA and FTC

Question 6

How long does a borrower have to move into property to be considered primary occupancy?

Answer 6

60 days

Question 7

The Fraud Enforcement and Recovery Act was signed into law in May 2009. It increased the penalties for a federal conviction for MORTGAGE FRAUD to :

Answer 7

$1,000,000 fine AND 30 years in prison

Question 8

Constructive Fraud

Answer 8

Unintentional, result of negligence

Question 9

RESPA
3 conditions an affiliated business must meet in order to satisfy the exception for referrals:

Answer 9

1. Disclosure of the relationship; written
2. No required use of the referred entity
3. Limitations on the “things of value” resulting from the arrangement (marketing swag is ok)

Question 10

Equity based lending prohibited under

Answer 10

HOEPA

Question 11

PENALTIES
State Regulatory Agency

Answer 11

up to $25k per violation

Question 12

PENALITIES
RESPA, Seciton 8

Answer 12

$10k and 1 year prison

Question 13

PENALTIES
TILA

Answer 13

$5K AND 1 YEAR

Question 14

PENALITIES
DNC

Answer 14

$43,792 per violation