A mortgage team asks a loan file reviewer about SCRA borrower protections during a new-license application. Which answer should guide the file?
Correct Answer
A) Review foreclosure timing under SCRA protections
Why this is correct: The Servicemembers Civil Relief Act (SCRA) provides specific protections for active-duty military personnel, including restrictions on foreclosure. A foreclosure action on a mortgage that originated before active duty generally cannot proceed without a court order if the servicemember's ability to pay is materially affected by military service. "Review foreclosure timing under SCRA protections" is the correct, compliant action to ensure these legal safeguards are not violated. Why the other choices are wrong: "Delay the SCRA Protections step until a later credit underwriting review instead of acting now" is wrong because SCRA protections are ongoing obligations for servicing and foreclosure, not just an underwriting step. "Wait until a regulator asks for the file before applying the federal requirement" is wrong because SCRA compliance is mandatory and proactive; waiting for a regulator is non-compliant. "Rely on oral agreement when the rule requires documented compliance" is wrong because SCRA benefits, like the 6% interest rate cap, require proper written documentation and verification of military status. Exam tip: SCRA's foreclosure protection requires a court order if the mortgage obligation predates active duty. Always check military status and applicable dates before initiating foreclosure.
Why This Is the Correct Answer
The correct response is "Review foreclosure timing under SCRA protections" because SCRA protects eligible servicemembers on covered obligations and foreclosure actions.
Why the Other Options Are Wrong
Option B: Delay the SCRA Protections step until a later credit underwriting review instead of acting now.
This distractor shifts the issue to a different trigger, product, or timing rule instead of applying the rule tested in the stem.
Option C: Wait until a regulator asks for the file before applying the federal requirement.
Wait until a regulator asks for the file before applying the federal requirement. is not correct because it does not apply the rule tested by this file scenario.
Option D: Rely on oral agreement when the rule requires documented compliance.
Rely on oral agreement when the rule requires documented compliance. is not correct because it does not apply the rule tested by this file scenario.
Memory Technique
SCRA borrower protections: identify the rule being tested, then choose the action that documents or applies that rule before the file moves forward.
Exam Tip
Match the file facts to SCRA borrower protections; do not choose an exception or shortcut that skips the required rule.
Common Mistakes to Avoid
- -Choosing an internal exception instead of the governing rule
- -Treating preliminary or informal facts as a substitute for required documentation
- -Answering from a familiar but unrelated mortgage topic
More Federal Laws Questions
A mortgage file is paused during a lock-desk handoff because of FCRA Adverse Action Notices. Which answer should identify which rule controls the file?
Before the team acts on a production meeting, a training manager must address SCRA Interest Rate Cap. Which response is most defensible?
Before the team acts on a production meeting, the MLO must address FCRA Adverse Action Notice. Which response is most defensible?
A team member asks about RESPA Kickbacks and Referrals in an investor-delivery review while trying to confirm the rule-based response. Which response should the loan team use?
During a disclosure desk review, the loan team encounters an RESPA Servicing Transfer issue. Which response should avoid a shortcut that would misapply the rule?
A mortgage team asks a quality-control reviewer about TRID Loan Estimate timing during a record-retention audit. Which answer should guide the file?
A mortgage team asks a branch supervisor about TILA APR and finance-charge rules during a renewal checklist. Which answer should guide the file?
A mortgage file is paused during a risk-control review because of TILA QM DTI Calculation. Which answer should choose the most defensible file action?
A disciplinary-risk review raises a question about TILA APR and finance-charge rules. Which action should the renewal specialist recommend?
An MLO is reviewing procedures for a case where a compliance analyst asks why covered mortgage application data is collected. What is the proper handling?
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