A mortgage company operating in Washington asks a renewal specialist about fees and compensation. Which statement follows the rule?
Correct Answer
C) 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: Assume NMLS status alone answers the fees and compensation question.
Assume NMLS status alone answers the fees and compensation question. 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: Keep only an informal supervisor note for a staff-training update.
Keep only an informal supervisor note for a staff-training update. 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 D: Wait for a regulator notice before applying the condition.
Wait for a regulator notice before applying the condition. 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: fees and compensation -> use the exact state rule in the explanation.
Exam Tip
Match the Washington fact pattern to the specific fees and compensation rule; do not answer from a generic state or federal assumption.
Common Mistakes to Avoid
- -Treating a Washington 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
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?
People Also Study
Federal Mortgage-Related Laws
24% of exam
General Mortgage Knowledge
20% of exam
Mortgage Loan Origination Activities
27% of exam
Ethics, Fraud & Consumer Protection
18% of exam