A lender's procedure in Washington for a staff-training update turns on a branch procedure turns on fees and compensation. Which statement is reliable?
Correct Answer
D) Washington prohibits loan originators from being paid directly by the borrower or charging borrower compensation for LO activity.
Under WAC 208-660-300, a Washington loan originator may not be paid directly by the borrower and may not charge the borrower a fee, commission, or compensation for preparing, negotiating, or brokering a residential mortgage loan.
Why This Is the Correct Answer
Washington prohibits loan originators from being paid directly by the borrower or charging borrower compensation for LO activity. This is correct because Under WAC 208-660-300, a Washington loan originator may not be paid directly by the borrower and may not charge the borrower a fee, commission, or compensation for preparing, negotiating, or brokering a residential mortgage loan.
Why the Other Options Are Wrong
Option A: Skip the state-specific step because a staff-training update has a national checklist.
Skip the state-specific step because a staff-training update has a national checklist. is not correct because the state rule supports: Washington prohibits loan originators from being paid directly by the borrower or charging borrower compensation for LO activity.
Option B: Treat the answer as business judgment rather than compliance.
Treat the answer as business judgment rather than compliance. is not correct because the state rule supports: Washington prohibits loan originators from being paid directly by the borrower or charging borrower compensation for LO activity.
Option C: Allow the activity if the borrower has signed disclosures.
Allow the activity if the borrower has signed disclosures. is not correct because the state rule supports: Washington prohibits loan originators from being paid directly by the borrower or charging borrower compensation for LO activity.
Memory Technique
Washington: a branch procedure turns on fees and compensation -> use the exact state rule in the explanation.
Exam Tip
Match the Washington fact pattern to the specific a branch procedure turns on fees and compensation rule; do not answer from a generic state or federal assumption.
Common Mistakes to Avoid
- -Treating a Washington a branch procedure turns on fees and compensation rule as a generic national mortgage rule
- -Choosing a familiar licensing answer that is not supported by the official authority
- -Ignoring the exact condition stated in the explanation
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