A title company offers to provide free notary services to an MLO's borrowers as a courtesy. Under RESPA, is this arrangement permissible?
Correct Answer
C) No, this constitutes a thing of value in exchange for referrals
Under RESPA Section 8, providing free services to an MLO's clients constitutes a thing of value given in exchange for referrals, which violates the anti-kickback provisions. The arrangement is prohibited regardless of whether it's disclosed.
Why This Is the Correct Answer
Under RESPA Section 8, providing free services to an MLO's clients constitutes a thing of value given in exchange for referrals, which violates the anti-kickback provisions. The arrangement is prohibited regardless of whether it's disclosed.
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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Bank statements show a borrower has $50,000 in a savings account that has been there for 6 months, but $30,000 was transferred to checking two days before closing. How should this transfer be treated?
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A dual-licensed professional works as both an MLO and a real estate agent. When originating a mortgage for a client where they also represented the buyer in the real estate transaction, they receive their normal MLO compensation plus a real estate commission. This dual compensation is: