Which of the following scenarios would MOST likely require the filing of a Suspicious Activity Report (SAR)?
Correct Answer
B) Multiple loan applications from the same borrower using different Social Security numbers
Using multiple Social Security numbers on loan applications is a clear indicator of identity fraud and would require SAR filing under the Bank Secrecy Act. This represents suspicious activity that could indicate mortgage fraud or identity theft.
Why This Is the Correct Answer
Using multiple Social Security numbers on loan applications is a clear indicator of identity fraud and would require SAR filing under the Bank Secrecy Act. This represents suspicious activity that could indicate mortgage fraud or identity theft.
More Ethics & Fraud Questions
A lender's mobile app prominently displays a 'pre-qualification' feature that asks for minimal information but generates loan amount estimates that are consistently 20-30% higher than what borrowers actually qualify for when they complete full applications. The app includes a disclaimer that estimates are 'subject to full underwriting.' This practice is most likely:
An MLO discovers that multiple loan applications from different borrowers contain identical handwriting in the signature sections, despite different purported signers. The applications were submitted by different real estate agents. What is the most appropriate immediate action?
A mortgage loan originator receives a lead from a real estate agent about a potential borrower. Before calling this consumer, the MLO must:
A mortgage company advertises 'Guaranteed approval for all credit types!' but internally has minimum credit score requirements of 580. This advertisement is problematic because it:
A borrower admits to an MLO that they inflated their income on the initial application but wants to provide correct information now. What should the MLO do?
An MLO's family member works as an appraiser and occasionally appraises properties for the MLO's borrowers through the normal appraisal management company rotation. The MLO never requests this appraiser specifically. Is this arrangement problematic?
During a fair lending examination, regulators discover that a bank's loan officers receive higher commissions for loans with interest rates above 6%, and statistical analysis shows borrowers in predominantly minority neighborhoods receive these higher-rate loans more frequently. This compensation structure would MOST likely be viewed as:
An MLO discovers a borrower has refinanced with three different lenders in the past two years, each time increasing the loan balance and paying substantial fees. The borrower mentions they were told each refinance would 'improve their financial situation.' The MLO's appropriate response should be:
An appraisal comes back significantly higher than the contract price with no reasonable explanation. The loan officer should:
An MLO's advertisement includes the statement 'Payments as low as $500 per month.' What additional disclosures are required under TILA?
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Previous Question
An MLO's family member works as an appraiser and occasionally appraises properties for the MLO's borrowers through the normal appraisal management company rotation. The MLO never requests this appraiser specifically. Is this arrangement problematic?
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A consumer provides their phone number on an online mortgage application but checks a box that says 'Do not contact me by phone.' The MLO wants to call about the application status. What should the MLO do?