Mortgage Loan Origination Practice Questions

Updated October 20, 2026

This area is 27% of the SAFE MLO test, about ~31 of the 115 scored questions. Below are 10 free practice questions written from the laws it covers, each with the answer, an explanation, and its source.

What this area covers

This is the biggest area on the test. Expect applied scenarios, not just definitions.

Weights are from the NMLS content outline. Question counts are our arithmetic (weight × 115).

10 practice questions

1. Under the ability-to-repay rule, income and assets must be verified using:
  1. Reasonably reliable third-party records
  2. The borrower's verbal statement only
  3. The real estate agent's opinion
  4. The MLO's estimate
Show answer and explanation

Answer: A. Reasonably reliable third-party records
Correct — §1026.43(c)(3)–(4).

Source: 12 CFR 1026.43(c)(4)

2. Under the current General QM definition, eligibility mainly depends on:
  1. The loan's APR compared with APOR (a price-based test), plus product feature limits
  2. A strict 43% DTI cap
  3. The borrower's credit score being at least 740
  4. Being FHA-insured
Show answer and explanation

Answer: A. The loan's APR compared with APOR (a price-based test), plus product feature limits
Correct — §1026.43(e)(2)(vi) replaced the old 43% DTI cap.

Source: 12 CFR 1026.43(e)(2)(vi)

3. For a QM loan of $100,000 or more (inflation-adjusted), total points and fees generally can't exceed:
  1. 1%
  2. 5%
  3. 3% of the total loan amount
  4. 8%
Show answer and explanation

Answer: C. 3% of the total loan amount
Correct — §1026.43(e)(3)(i).

Source: 12 CFR 1026.43(e)(3)(i)(A)

4. A creditor generally must provide a revised Loan Estimate after a rate that was floating is locked:
  1. Only if the borrower asks
  2. No later than 3 business days after the lock
  3. At closing
  4. Within 30 days
Show answer and explanation

Answer: B. No later than 3 business days after the lock
Correct — §1026.19(e)(3)(iv)(D).

Source: 12 CFR 1026.19(e)(3)(iv)(D)

5. Which Closing Disclosure section shows the final amount the borrower must bring to closing?
  1. Calculating Cash to Close
  2. Loan Terms
  3. Contact Information
  4. Projected Payments
Show answer and explanation

Answer: A. Calculating Cash to Close
Correct — §1026.38(i).

Source: 12 CFR 1026.38(i)

6. Which Loan Estimate section shows the loan amount, interest rate, monthly principal and interest, and whether these can increase?
  1. Loan Terms
  2. Costs at Closing
  3. Comparisons
  4. Projected Payments
Show answer and explanation

Answer: A. Loan Terms
Correct — §1026.37(b).

Source: 12 CFR 1026.37(b)

7. The "Total Interest Percentage" (TIP) on the LE and CD is:
  1. The DTI ratio
  2. The APR
  3. The note rate
  4. Total interest paid over the loan term as a percentage of the loan amount
Show answer and explanation

Answer: D. Total interest paid over the loan term as a percentage of the loan amount
Correct — §1026.37(l)(3).

Source: 12 CFR 1026.37(l)(3)

8. Under Fannie Mae and Freddie Mac's UAD 3.6 update (mandatory Nov. 2, 2026), the legacy appraisal forms such as Form 1004 are being replaced by:
  1. A single redesigned Uniform Residential Appraisal Report (URAR)
  2. Form 1008
  3. Form 1003
  4. The Closing Disclosure
Show answer and explanation

Answer: A. A single redesigned Uniform Residential Appraisal Report (URAR)
Correct — the GSEs' UAD 3.6 and Forms Redesign retires the legacy forms in favor of one redesigned URAR.

Source: Fannie Mae: UAD 3.6 and Forms Redesign (redesigned URAR; Nov. 2, 2026 mandate)

9. Under Regulation Z appraisal independence rules, an MLO may NOT:
  1. Order an appraisal through an AMC
  2. Pressure an appraiser to hit a specific value
  3. Give the appraiser a copy of the sales contract
  4. Ask the appraiser to correct a factual error
Show answer and explanation

Answer: B. Pressure an appraiser to hit a specific value
Correct — §1026.42(c)(1).

Source: 12 CFR 1026.42(c)(1)

10. Which action IS allowed under the Regulation Z valuation independence rules?
  1. Using only appraisers who always hit contract price
  2. Withholding payment unless the value comes in high
  3. Asking the appraiser to consider additional property information or correct factual errors
  4. Telling the appraiser the minimum value needed
Show answer and explanation

Answer: C. Asking the appraiser to consider additional property information or correct factual errors
Correct — §1026.42(c)(3)(i)–(ii).

Source: 12 CFR 1026.42(c)(3)(i)

Practice with every question

Focused, not overwhelming: 717 questions in 11 short chapters, each with an explanation for every option and an official source, plus three timed 120-question, 190-minute practice exams.

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Official sources

FAQ

What is the biggest section on the SAFE MLO test?

Mortgage loan origination activities, at 27% of the test (NMLS content outline).

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