A mortgage lender pays MLOs a standard commission rate but offers a temporary 'promotion period' where MLOs can earn double commissions on all loans closed within a specific 30-day period to boost monthly production. This promotional compensation:
Correct Answer
B) Is permitted because it applies equally to all loans regardless of terms
Temporary promotional compensation that applies equally to all loans regardless of their terms is permitted under Dodd-Frank, as long as it doesn't create incentives based on specific loan characteristics or terms.
Why This Is the Correct Answer
Temporary promotional compensation that applies equally to all loans regardless of their terms is permitted under Dodd-Frank, as long as it doesn't create incentives based on specific loan characteristics or terms.
More Origination Questions
A borrower has a construction-to-permanent loan with a 12-month construction phase. At month 10, construction is only 60% complete due to delays. What is the most likely outcome?
For a construction-to-permanent loan, when must the initial Closing Disclosure be provided for the construction phase?
During a refinance transaction, the appraiser determines that significant unpermitted additions were made to the property. The appraiser wants to discuss this with the MLO before finalizing the report. What should the MLO do?
An appraiser discovers that a property has significant foundation issues that were not disclosed. The appraiser reduces the property value by $25,000 and includes detailed comments about the structural problems. The loan officer is upset because this will kill the deal. Under AIR, the loan officer:
An MLO's compensation structure includes higher payments for certain loan products. When is it acceptable to recommend these higher-compensated products?
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An MLO receives an application from a borrower on Tuesday at 4 PM. The borrower emails additional required documentation on Thursday at 10 AM, making the application complete. When must the Loan Estimate be delivered?
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