Casey notices a compliance issue tied to prequalification and ATR — Income Verification. What is the best next step?
Correct Answer
B) Do not treat prequalification as final approval
prequalification is preliminary and must be updated with verified debts, income, and application facts. This item uses an exam-style scenario; any file details in the stem are illustrative and the governing rule controls the compliant response. The best answer is "Do not treat prequalification as final approval".
Why This Is the Correct Answer
prequalification is preliminary and must be updated with verified debts, income, and application facts. This item uses an exam-style scenario; any file details in the stem are illustrative and the governing rule controls the compliant response. The best answer is "Do not treat prequalification as final approval".
More Origination Questions
In a mortgage origination file, a processor wants to omit known monthly obligations from underwriting. Which action should be taken?
A compliance review finds that the person preparing the valuation would be paid more if the value is higher. What should the MLO do next?
During intake, the consumer locks the interest rate after the initial disclosure package. What is the best compliant response?
An MLO is reviewing procedures for a case where a processor wants to omit known monthly obligations from underwriting. What is the proper handling?
In a mortgage origination file, a HELOC will provide funds for the down payment on the same dwelling. Which action should be taken?
A borrower-facing employee is unsure what to do when a manager proposes higher pay for loans with a higher interest rate. What is the correct response?
In a mortgage origination file, a manager proposes higher pay for loans with a higher interest rate. Which action should be taken?
A branch manager asks about a loan file because a loan officer wants the appraiser to raise the value to make the deal work. What should happen?
Before closing, the team discovers that a loan officer wants the appraiser to raise the value to make the deal work. What is the safest compliant answer?
A borrower-facing employee is unsure what to do when a loan officer wants the appraiser to raise the value to make the deal work. What is the correct response?
People Also Study
Federal Mortgage-Related Laws
24% of exam
General Mortgage Knowledge
20% of exam
Ethics, Fraud & Consumer Protection
18% of exam
Uniform State Test Content
11% of exam
Related Study Resources
Previous Question
During quality control, Elliot finds a file issue involving third party and RESPA — Kickbacks and Referrals. Which action is most appropriate?
Next Question
A compliance review finds that the borrower pays the broker directly and the creditor also offers compensation. What should the MLO do next?