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Illinois Residential Mortgage License
Terms in this set (125)
Required Net worth of mortgage broker?
Required net worth of mortgage banker?
What must be signed whenever any changes are made to the loan?
Change of loan and process disclosure
Is an MLO license transferable or assignable?
What is an FHA stream line refinance?
Refinance the balance and getting no equity out of it
Ho long must a licensee hold onto the documentation on a loan?
What year was the SAFE act passed and adopted?
What is RMLA and what year was it passed?
Residential Mortgage License Act. passed in 1987
What are good funds and what are some examples?
Lawful money in the US. Ex: Check issued by the state, wired funds, cashier's check, personal check up to $5,000
What is the cost to appeal?
What is the minimum surety bond amount for licensees?
What is an MU4 document and what is its filing fee?
When an MLO changes employment or a new MLO being sponsored. $30 fee
How many times must a licensee file a Mortgage Service Report (MSR)?
Annually, once a year on March 1st
What does averment mean?
What is the purpose of RMLA (5 parts)
1. Sets business standards
2. Protects consumers
3. Ensures fair honest operations
4. Ensures funding availability
5. State participation in NMLS
What index is used on high risk home loans?
Treasury constant index
What regulation covers federal advertising?
When a loan does not require counseling, what is required?
A certificate of exemption
During which months should semi-annual reports be given to the governor and general assembly?
May 1st - Nov 1st
Which document discloses late charge fee or loan?
How many days does the lender have if an error made during an attempt to collect on a home loan? How many days to refund?
An appraiser who holds a license of this classification under this act, applies to the appraisal of 1-4 units of residential real estate is known as what?
State certified residential real estate appraiser
True or False: A prepayment penalty is not allowed for loans over 8% interest rate
What are 3 triggering activities that require you to be licensed?
1. Negotiating terms
2. Expecting compensations
3. Taking an application
What fee can be collected by mortgage broker at application?
Credit Report Fee
What is a supervising appraiser?
Holds a valid license under this act. Either a state certified general real estate appraiser or a state certified residential real estate appraiser. Anything other than 1-4 dwellings.
Under what act are the terms 'equity stripping' and 'loan flipping'?
Illinois fairness in lending act
What is APHD?
Anti-predatory lending data base
Ho long must a loan log be kept?
How many fields in a loan log?
A mortgagee is entitled to what info?
1. Contact name and address of licensee
2. Contact name
3. Amount owed in total 3 months
4. Address & phone number of whoever is responsible for next 3 payments owed.
APR is required if any of these terms are used in advertisement....
1. Down payment
2. % down payment
7. # of payments
3. Amount of payments
4. Finance charge
5. Mortgage amount
6. Terms of mortgage
Maximum fine for MLO per day? and up to? How much for repeated violations per to? and up to?
Max fine = $1,000
up to $3,000.
Repeated max fine = $2,000 up to $6,000
What is maximum licensee fine for each violation? And max for multiple?
$25,000 each up to $75,000
What are two ways the borrower's income and financial resources can be verified?
Tax returns and payroll receipts
What institutions are exempt from licensing?
State chartered banks & credit unions, Persons originating an amount less than 10 loans per year for
their personal portfolio, and not in the ordinary course of their business, FDIC regulated institutions, Realtors if they don't receive compensation
Consumer fraud and deceptive practices act can go back how far?
Upon written notice to licensee who will suspend or revoke any license issued?
The commissioner, aka the director
What is a first tier subsidary?
Stock owned directly by the parent company without any intervening layers by another corporation
When a loan rate is greater than 8% and charges limited to 3%, some wholesales will include what?
Yield Spread Premium
An instructor of an approved NMLS course is credited with how many CE hours?
2 CE hours for every hour of instruction
What is the maximum prepayment penalty you can have?
3% the 1st year. 2% the 2nd year. 1% the 3rd year.
Illinois fairness and lending act covers what?
Equity stripping and loan flipping
Advertisements that portray government-supported loans are prohibited when?
The government is not involved
Section 1050 of RMLA is used for what?
Rules help in enforcing the law or explain the law of RMLA
True or False: A mortgage broker does not need a fidelity bond of $100,000.
What are 2 NMLS regulators?
CSBS and AARMR
When must a licensee maintain an office in a state?
Whenever its the principal place of business
Good faith means...
Honesty in the fact in the conduct of the transaction. Cannot accept fees if there is not a reasonable likelihood a commitment for the loan to be issued
What is the Illinois Administrative Procedures act?
Allows agency reviews
In the case of non-compliance with subpoena issued by commissioner, what are his options?
Commissioner can petition circuit court of county in the area of the persons principal place of business
What is home equity loan? Except what kind?
Any loan secured by a primary residence except a purchase money loan
Who can take action against the lender in the Illinois fairness and lenders act?
Borrower, attorney general, states attorney general
What is piercing the corporate veil?
When a court by-passes limited liability, and holds the owners accountable. I.e: Owner can lose his assets
When a company is closing a branch or shutting down completely the IDFPR must be notified when?
10 days prior to close
What does IDFPR stand for? Why was it forward?
Illinois Department of Financial and Professional Regulation. To protect the consumer.
How often must a licensee file a Mortgage call report?
Once a quarter, no later than 45 days
What are two functions, powers, and duties of the commissioner of banks and real estate that fall under 205 ILCS 635/4-1?
Issue or refuse to issue any license as provided by this act. Revoke or suspend any license issued under this act.
What is a short sell?
When a lender takes less than what's totally owed, when someone selling their home.
What does Illinois (HPA) Homeowners Protection Act do for Homeowners?
Gives homeowners who fall behind on their mortgage payments time to work with their lender to develop a plan that will allow them to stay in their home.
From the date of application what is the number of calendar days that you have to enter your data into the (APLD) Anti-predatory lending database?
Which 4 counties are a part of the Anti-predatory lending database?
Cook, Kane, Will, Peoria
For Qualifications an owner has to go through background, credit, and fingerprint check.
Ones considered an owner if having _____ percent or more.
What is the time table for review from the examiner when given a 3 rating?
What is needed in all advertisements?
Illinois residential mortgage license
When examiner gives a rating it is relevant to the amount of time until next review? Name 1 through 5.
1&2 = 36 months, 3 = 24 months, 4 = 12 months, 5=continual monitoring.
What document must be signed before the loan application is signed?
Loan brokerage agreement
How often must a licensee have their net worth audited, and by who?
Every year by the CPA
When is a certificate of compliance required?
Whenever a loan requires counseling
How long must advertising material be held onto?
What requires re-counseling under APLD?
When switching loan product types, and if APR increases by 2%
What are the High Risk Home Loan triggers?
Fee trigger of 5%, APR triggers of 6% on 1st mortgage, 8% on 2nd mortgages.
What are the 7 powers of the commissioner?
1. Refuse Applications.
2. Receive/Request All Records.
3. Revoke / suspend all licenses.
4. Keep all records.
5. Enact recommendations of the RMB.
6. Investigate consumer complaints.
7. Examine Books/ Records of License.
What are the 3 terms you can never use in advertisements?
1. Establish, 2. Set, 3. Recommended.
When mailing a loan package to be signed and returned, a conspicuous message must state the following:
The borrower must make a copy of all signed documents
True or False: The Compilation may be done in house by the Licensee
What are 4 things true about the compilation?
a. All companies must provide audited financials when they apply for a license
b. Must file financials yearly, no later than 90 days after the end of their fiscal year
c. Mortgage broker must submit this
d. Will find the company an immediate $5,000 non refundable if they are untruthful in the form
What is the fee on an MU4 when changing employment or for a new employee being sponsored?
True or False: Under the Illinois Fraud and Deceptive Practices Act for a retail transaction not conducted in a consumers native language an employee of the retailer may act as the interpreter/ they can bring their own interpreter/ a special disclosure must be completed
As required by the Act, what percentage of a Licensee's (mortgage broker or mortgage banker) minimum net worth must be liquid?
In order to be licensed as a Mortgage Banker under the Act a company applicant is required to have the following
Required net worth verified by an audit completed by an Illinois CPA, Errors and Omissions Insurance, $100,000 Fidelity Bond
A Loan Brokerage Disclosure Statement discloses:
A Broker Licensee does not provide the funds for the loan.
The Borrower Information Document, must indicate that upon request a mortgage broker shall furnish to the Borrower or the Borrower's Attorney all of the following except:
Sample of the commitment letter to be used
The loan log which must be maintained by mortgage brokers and mortgage bankers under the Act. Which of the following is not collected:
legal description of the property
The Regulations for Mortgage Brokers requires which of the following disclosures
a. Loan Commitment
b. Adverse Action Notice
c. Change of Loan in Process
Which of the following is not included in an approval notice pursuant to the Act (Section1050.1305)?
The following terms are considered "triggering" terms for the calculation of APR
True or False: When dealing with a 30 year fixed rate loan that is fully amortizing there is a prohibition against a licensee under the Act collecting a prepayment penalty if the interest rate exceeds 8%
True or False: On second mortgages, you can collect only 3 points if you fund as a mortgage banker.
True or False: Loans with an interest rate above 8% are exempt from Illinois Interest Rate Act
5 things that trigger counselling
1. Interest Only
2. Negative Amortization
3. Prepayment penalties
4. Exceeds the 5% trigger
5. An ARM product 3/1 or less
From the date of application, what is the number of calendar days that you have to enter your data into the Anti-Predatory Lending Database
When mailing a loan package to be signed and returned, a conspicuous message must state the following:
The borrower(s) must make a copy of all documents signed.
Within how many days shall the licensee submit his/her renewal application and fees to the commissioner?
The Commissioner shall conduct an examination of each licensee having a default rate equal to or greater than?
True or False: Mortgage brokers shall account to a borrower for all of the borrower's money and property received as an agent.
What is the percentage received by the licensee, if a prepayment is made during the third 12-month period following the date the loan was made if the fixed rate period extends 3 years?
A licensee must notify the borrower if the monthly principal increases by more than:
Regulation Z serves to prevent lenders from making HOEPA loans without first considering:
the consumer's ability to repay the loan
To protect consumers in resolving the affairs of the licensee, the Commissioner shall request the Attorney General of this State to petition the court to appoint:
a receiver or conservator
What is the maximum percentage of the total loan amount that the consumer may pay before closing in points and fees?
True or False: 1 $25,000 US Postal Service Check is a 'good fund'
True or False: Any US Legal tender or cash money, A $10,000 bank check, A personal with a bank verification letter are all considered good funds
The database created under APLD program will be designed to:
Allow brokers, originators, counselors, title insurance companies and closing agents to submit information to
the database online
Who should maintain a fidelity bond?
Fidelity bond should be maintained by a mortgage licensee who deals with other people's money
The Commissioner shall cause an audit of the licensee's books and accounts to be made by a certified public accountant if a licensee fails to file a compilation as required:
at the licensee's expense
Is there any need for a licensee maintain at least one full service office with staff reasonably adequate to handle communications, whose principal place of business is located in Illinois?
Yes, they have to maintain at least one full service office
Borrower is entitled to the following information:
Contact name and address of the new licensee; contact name, address and telephone number of the person to whom the next three month's payments are owing, and the amount owed in total for those three months.
Application for Licensee is how much?
$2,700. of which $1,500 is non-refundable.
A penalty of $567.50 will be assessed after 30 days and $1,135.00 for each month after that. After
one year License will expire. Licensee is inactive (out of business) if not renewed but may process
loans taken before license is inactive.
The fee can be waived if an out of state mortgage banker services 100 or fewer loans in Illinois and
does not originate - must apply for this exception each year
Out of State LICENSEE must maintain a net worth of $() IF THEY DO NOT HAVE A FULL
SERVICE OFFICE IN ILLINOIS. If they have offices in the state, $() is acceptable
$150,000 and $50,000
Amended licensee - $500.00 Notice of Change or Duplicate License $50.00
Additional Office fee - $250.00 plus $250.00 Annual fee Hearing fee - $500.00
MLO Licensing Fee - Initial licensing fee is $200.00; Annual Renewal Fee $150.00; Reinstatement
Registration Fee for each MLO when they are sponsored by a Licensee - $50.00
Criminal Background Fee $39.00
Federal Test Fee $110.00
NMLS State Test Fee $69.00
Examiner Fee is $510.00 per day due 30 days after billing
Audit work papers are due () days before the deadline as set by IDFPR
Payoff letter within () days of request
If a customer deliver a written request to cancel the loan application ON THE SAME DAY, the licensee must refund all monies except how much?
Illinois will not allow a balloon to balloon any sooner than
Counseling fee can't exceed
If employment ceases - must be reported within how many days
If felony, judgment or criminal conviction must be reported in how many days
10 days of conviction
The director can revoke or fail to renew any licensee that is (blank) late with child support
Borrower has the right to cancel escrow after the balance of the loan reaches :
65% OF THE
Ad must also contain
EQUAL HOUSING LOGO, THE AD MUST STATE THE APR IN A FONT THAT IS THE SAME SIZE OR LARGER THAN THE INTEREST RATE, LOAN TERM, LOAN AMOUNT OR CLOSING COSTS
What is the daily fee for the examiner to investigate?
If you do not file your annual financial statements within 90 days, then you pay
$50 a day fine for a period not to exceed 3 months, $4,500
(blank) means the borrower can sue, (blank) means only the attorney general can file