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
More UST Questions
In a pricing desk question, an audit analyst sees facts tied to Prohibited Misrepresentation. What should the file reflect?
An applicant previously had an MLO license revoked by a state regulator. Under the SAFE Act minimum standards for a new state-licensed MLO license, which statement is correct?
Which statement correctly distinguishes a license suspension from a license revocation?
A state regulator has issued an order suspending an MLO's authority effective immediately. The MLO has filed an appeal, but no stay has been granted. What should the MLO do?
An MLO license application asks whether the applicant has been the subject of a regulatory order. The applicant has a recent consent order that falls within the question. What is the proper response?
Why does NMLS maintain licensing and enforcement information that participating regulators can access?
A regulator issues a final license suspension without giving the MLO notice of the alleged violation or any opportunity to respond, even though applicable law requires both. What issue is presented?
A regulator finds that an MLO charged consumers prohibited fees. Which set of actions is consistent with the enforcement tools contemplated by Regulation H?
An MLO's license status in NMLS changes to suspended, with no stay or reinstatement shown. What is the immediate operational effect?
Which fact most directly supports disciplinary action against an MLO rather than merely a request for additional application information?
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