A practice question asks about RESPA and escrow servicing compliance. Which answer best matches the official North Carolina rule?
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: Treat the requirement as waived because the borrower or employer agrees.
Treat the requirement as waived because the borrower or employer agrees. is not correct because the governing rule requires the compliant answer shown in the explanation.
Option B: Assume another state's approval automatically satisfies the North Carolina requirement.
Assume another state's approval automatically satisfies the North Carolina requirement. is not correct because the governing rule requires the compliant answer shown in the explanation.
Option D: Apply the North Carolina rule only to company licenses and never to individual MLO activity.
Apply the North Carolina rule only to company licenses and never to individual MLO activity. 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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