A servicer transfers servicing rights on an NC residential mortgage loan. What is the best conclusion under North Carolina MLO law or NCCOB guidance?
Correct Answer
C) NC prohibited-acts provisions require compliance with RESPA servicing transfer, escrow-account administration, borrower inquiry response requirements, and applicable federal servicing framework.
NC prohibited-acts provisions require compliance with RESPA servicing transfer, escrow-account administration, borrower inquiry response requirements, and applicable federal servicing framework. North Carolina imposes servicing-transfer and escrow-related duties, including compliance with RESPA and the federal Real Estate Settlement Procedures Act servicing framework.
Why This Is the Correct Answer
NC prohibited-acts provisions require compliance with RESPA servicing transfer, escrow-account administration, borrower inquiry response requirements, and applicable federal servicing framework. North Carolina imposes servicing-transfer and escrow-related duties, including compliance with RESPA and the federal Real Estate Settlement Procedures Act servicing framework.
Why the Other Options Are Wrong
Option A: Continue the activity and document the issue only if a complaint is later filed.
Continue the activity and document the issue only if a complaint is later filed. is not correct because the governing rule requires the compliant answer shown in the explanation.
Option B: Let the MLO originate while waiting for the North Carolina status, sponsorship, or renewal issue to be corrected.
Let the MLO originate while waiting for the North Carolina status, sponsorship, or renewal issue to be corrected. is not correct because the governing rule requires the compliant answer shown in the explanation.
Option D: Let production staff decide whether advertising and consumer-protection controls matters for the file.
Let production staff decide whether advertising and consumer-protection controls matters for the file. is not correct because the governing rule requires the compliant answer shown in the explanation.
Memory Technique
NC -> nc-servicing-prohibited-acts-advertising-and-high-cost
Exam Tip
NC folds federal servicing duties into state prohibited-act compliance.
Common Mistakes to Avoid
- -Using a national baseline answer when North Carolina has a state-specific rule
- -Confusing company licensing, MLO licensing, and sponsorship
- -Treating an exemption or temporary authority rule as a blanket waiver
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