Which of the following activities is PROHIBITED for a CRMLA-licensed lender?
Correct Answer
D) Paying a kickback to a real estate agent for referring mortgage clients
The CRMLA prohibits kickbacks and referral fees that are not earned for actual services rendered. Paying kickbacks to real estate agents for steering borrowers violates both the CRMLA and federal RESPA provisions.
Why This Is the Correct Answer
Paying a kickback to a real estate agent for referring mortgage clients is correct. The CRMLA prohibits kickbacks and referral fees that are not earned for actual services rendered. Paying kickbacks to real estate agents for steering borrowers violates both the CRMLA and federal RESPA provisions. The CRMLA prohibits kickbacks and referral fees that are not earned for actual services rendered. Paying kickbacks to real estate agents for steering borrowers violates both the CRMLA and federal RESPA provisions.
Why the Other Options Are Wrong
Option A: Charging a borrower reasonable loan origination fees
Charging reasonable loan origination fees is a permitted practice. CRMLA lenders may charge fees that are disclosed and reasonable.
Option B: Disclosing all loan terms and costs to the borrower in writing
Written disclosure of loan terms and costs is required by law, not prohibited. Transparency is a cornerstone of CRMLA compliance.
Option C: Offering multiple loan products to a qualified borrower
Offering multiple loan products is not prohibited. In fact, presenting suitable options serves the borrower's interest.
Memory Technique
CA -> ca-crmla-lenders-servicers-bonds-net-worth-servicing
Exam Tip
CRMLA questions usually turn on lender versus servicer authority, branch authority, $250,000 net worth, surety bond coverage, servicing duties, DFPI oversight, and exemptions for regulated depository institutions.
Common Mistakes to Avoid
- -Using a national baseline answer when California has agency-specific DFPI or DRE requirements
- -Confusing CFL, CRMLA, covered-loan, usury, servicing, and DRE endorsement rules
- -Relying on legacy California state-exam or education assumptions instead of current NMLS source pages
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