An MLO receives an application where the borrower's Social Security number was issued after the borrower's stated birth date by 25 years. The borrower explains they were undocumented previously. How should this be handled?
Correct Answer
B) Verify the SSN through appropriate channels and document the explanation
While the timeline may seem suspicious, legitimate reasons exist for delayed SSN issuance. The MLO should verify the SSN through proper channels (Social Security Administration verification) and document the borrower's explanation, as required under CIP and anti-fraud procedures.
Why This Is the Correct Answer
While the timeline may seem suspicious, legitimate reasons exist for delayed SSN issuance. The MLO should verify the SSN through proper channels (Social Security Administration verification) and document the borrower's explanation, as required under CIP and anti-fraud procedures.
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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