An MLO receives a call from someone claiming to be from the borrower's insurance company requesting loan balance information to process a claim. The caller provides the borrower's social security number and address. How should the MLO respond?
Correct Answer
B) Request written authorization from the borrower before disclosure
Having identifying information does not authorize disclosure. Under privacy regulations, the MLO must obtain proper written authorization from the borrower before sharing nonpublic personal information with third parties, even legitimate-sounding business entities.
Why This Is the Correct Answer
Having identifying information does not authorize disclosure. Under privacy regulations, the MLO must obtain proper written authorization from the borrower before sharing nonpublic personal information with third parties, even legitimate-sounding business entities.
More Ethics & Fraud Questions
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Previous Question
An MLO working with non-English speaking borrowers consistently uses a translator who is the real estate agent's assistant rather than an independent interpreter. The MLO knows this person has limited mortgage knowledge but uses them because they're 'convenient and free.' The borrowers receive translated documents but may not fully understand complex mortgage terms. This practice:
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A mortgage company's underwriting guidelines require verification of employment for self-employed applicants but not for traditionally employed applicants. Data shows this policy disproportionately affects Latino applicants who are more likely to be self-employed. The company argues this is necessary for risk management. This situation involves: