An MLO receives a subpoena requesting borrower financial information for a court case. What should the MLO do?
Correct Answer
C) Consult with legal counsel and follow proper procedures for responding to legal process
When served with a subpoena or other legal process, MLOs should consult with legal counsel to ensure proper procedures are followed. Legal process may require disclosure of otherwise confidential information, but proper verification and procedures must be followed.
Why This Is the Correct Answer
When served with a subpoena or other legal process, MLOs should consult with legal counsel to ensure proper procedures are followed. Legal process may require disclosure of otherwise confidential information, but proper verification and procedures must be followed.
More Ethics & Fraud Questions
A lender's mobile app prominently displays a 'pre-qualification' feature that asks for minimal information but generates loan amount estimates that are consistently 20-30% higher than what borrowers actually qualify for when they complete full applications. The app includes a disclaimer that estimates are 'subject to full underwriting.' This practice is most likely:
An MLO discovers that multiple loan applications from different borrowers contain identical handwriting in the signature sections, despite different purported signers. The applications were submitted by different real estate agents. What is the most appropriate immediate action?
A mortgage loan originator receives a lead from a real estate agent about a potential borrower. Before calling this consumer, the MLO must:
An MLO tells Asian applicants that they need larger down payments 'because that's what investors prefer for your type of loan,' while telling similarly qualified white applicants that standard down payments are acceptable. This practice represents:
A mortgage company advertises 'Guaranteed approval for all credit types!' but internally has minimum credit score requirements of 580. This advertisement is problematic because it:
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Previous Question
A loan officer discovers that a borrower has provided false employment verification documents. The borrower explains they recently lost their job but expect to find new employment soon and just need the loan to keep their family housed. How should this be classified?
Next Question
An MLO's automated dialing system accidentally calls a number on the National Do Not Call Registry at 7:45 AM on a Tuesday. The consumer complains. What is the potential penalty per violation under the TCPA?