Which of the following loan types would NOT be subject to conforming loan limits?
Correct Answer
D) Portfolio loans held by the originating bank
Portfolio loans that are kept by the originating lender and not sold to GSEs are not subject to conforming loan limits. FHA loans have their own loan limits set by HUD, while conventional loans sold to Fannie Mae and Freddie Mac must conform to FHFA limits.
Why This Is the Correct Answer
Portfolio loans that are kept by the originating lender and not sold to GSEs are not subject to conforming loan limits. FHA loans have their own loan limits set by HUD, while conventional loans sold to Fannie Mae and Freddie Mac must conform to FHFA limits.
More Mortgage Knowledge Questions
A borrower is comparing two loan offers: Loan A has no points and 4.5% interest rate, Loan B has 2 points and 4.0% interest rate. The loan amount is $400,000. How much will the borrower pay upfront for the points on Loan B?
A lender charges a 1% origination fee on all loans. For a borrower obtaining a $250,000 mortgage, what is the maximum origination fee that can be charged without violating the points and fees test under the ATR/QM rule for a first-lien mortgage?
Under what circumstances can a Qualified Mortgage include a prepayment penalty?
A borrower is considering paying discount points to reduce their interest rate. Each point costs 1% of the loan amount and reduces the rate by 0.25%. On a $300,000 loan, how much would the borrower pay for 2 discount points?
A borrower asks about the difference between discount points and origination fees. What is the most accurate explanation?
People Also Study
Federal Mortgage-Related Laws
23% of exam
Mortgage Loan Origination Activities
25% of exam
Ethics, Fraud & Consumer Protection
17% of exam
Uniform State Test Content
12% of exam
Previous Question
A borrower applies for an FHA loan in a county where the loan limit is $472,030. They want to purchase a duplex for $650,000 and live in one unit while renting the other. What is the maximum FHA loan amount available?
Next Question
An MLO is working with a borrower whose previous home had escrow waived, but the new loan requires escrow. The borrower is concerned about the payment shock. What is the most appropriate guidance?