In reviewing a loan file, an MLO notices the borrower's signature varies significantly between the initial application and subsequent documents, and the handwriting style appears different. The borrower states they injured their hand. What should the MLO do?
Correct Answer
B) Require the borrower to sign all documents in the MLO's presence
Significant signature variations may indicate identity theft or fraud. Having the borrower sign documents in the MLO's presence allows for direct verification of identity and signature, which is a reasonable fraud prevention measure under SAFE Act requirements.
Why This Is the Correct Answer
Significant signature variations may indicate identity theft or fraud. Having the borrower sign documents in the MLO's presence allows for direct verification of identity and signature, which is a reasonable fraud prevention measure under SAFE Act requirements.
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An MLO's former colleague, now working at a different lender, asks for contact information of previous mutual clients who might be interested in refinancing. The colleague promises to share referral fees. What is the primary violation?
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A mortgage company's policy requires borrowers with credit scores below 620 to provide additional documentation that borrowers with higher scores don't need. During testing, this policy is found to disproportionately affect African American applicants. The company can defend this practice if: