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ABA CRCM Practice Test - Questions Answers, Page 12

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Question 111

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According to the 2007 interagency statement on subprime mortgage lending, what should an institution offering mortgage loans to subprime borrowers provide before submission of an application?

Information on local residential real property values
Information on local residential real property values
Payment shock information
Payment shock information
Truth in Lending disclosures
Truth in Lending disclosures
Initial escrow statements
Initial escrow statements
Suggested answer: B
asked 16/09/2024
Clive Roberts
50 questions

Question 112

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The senior lender at ABC bank would like to make stated income mortgage loans (i.e., loans where the bank does not verify the applicant's income) to mortgage customers, including subprime borrowers. Under the statement on subprime mortgage lending, which of the following is the best statement of the bank's responsibility regarding this new program?

Due to the risks, it should not implement such a program for subprime borrowers
Due to the risks, it should not implement such a program for subprime borrowers
The bank should make a policy for this program that includes mitigating factors for the risks
The bank should make a policy for this program that includes mitigating factors for the risks
The bank should set stringent debt-to-income ratios for these loans
The bank should set stringent debt-to-income ratios for these loans
The bank should establish workout procedures for such loans in advance of making them.
The bank should establish workout procedures for such loans in advance of making them.
Suggested answer: B
asked 16/09/2024
Natcha Koopipat
46 questions

Question 113

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Under Regulation M, what is a ''consumer lease''?

Any lease of $25,000
Any lease of $25,000
A consumer lease for $25,000 or less with an option to own the property after the lease expires
A consumer lease for $25,000 or less with an option to own the property after the lease expires
A consumer lease for $25,000 or less for the use of personal property
A consumer lease for $25,000 or less for the use of personal property
Any consumer or agricultural lease for $25,000 or less
Any consumer or agricultural lease for $25,000 or less
Suggested answer: C
asked 16/09/2024
Vladimir Litvinenko
34 questions

Question 114

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Milton Edwards leased an automobile from First National Bank. The lease contained a provision whereby Milton would be liable for the automobile at the end of the lease based on its fair market value. At the end of the lease, the bank notified Milton that the value of the automobile, based on industry publications, was $10,500 and required him to pay that amount to obtain ownership of the property. Milton objected and requested that the car be individually appraised.What must the bank do?

Nothing; an estimate of the value based on industry standards is sufficient
Nothing; an estimate of the value based on industry standards is sufficient
Hire an independent appraiser to appraise the automobile (both parties agree to be bound by the appraisal)
Hire an independent appraiser to appraise the automobile (both parties agree to be bound by the appraisal)
Allow Milton to hire an independent appraiser to appraise the automobile (both parties agree to be bound by the appraisal)
Allow Milton to hire an independent appraiser to appraise the automobile (both parties agree to be bound by the appraisal)
Use the average of the car value as determined by a third party appraiser Milton hires with the original bank appraisal
Use the average of the car value as determined by a third party appraiser Milton hires with the original bank appraisal
Suggested answer: C
asked 16/09/2024
Vishal Gandhi
40 questions

Question 115

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When must disclosures on consumer leasing transactions subject to Regulation M be made?

At the time of the application
At the time of the application
Before the consummation of the lease
Before the consummation of the lease
Before the first payment due under the lease
Before the first payment due under the lease
Within 10 days after consummation of the lease
Within 10 days after consummation of the lease
Suggested answer: B
asked 16/09/2024
Feras Al Babtain
31 questions

Question 116

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A bank does not know all of the specific information to be disclosed on the lease at the time of the consummation. What may the bank do after attempting to obtain the information?

Omit the unknown disclosures
Omit the unknown disclosures
Estimate the amounts and note that the information is estimated
Estimate the amounts and note that the information is estimated
Delay consummation of the transaction until the information is ascertained
Delay consummation of the transaction until the information is ascertained
Estimate the information based on averages of all other leasing transactions the bank has made within the last six months
Estimate the information based on averages of all other leasing transactions the bank has made within the last six months
Suggested answer: B
asked 16/09/2024
Arun Samuel
49 questions

Question 117

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What insurance disclosures are required in the lease disclosure statement?

The types and amounts of coverage provided by the lessor and the cost to the lessee
The types and amounts of coverage provided by the lessor and the cost to the lessee
The types, amounts, and estimated costs of recommended coverage even if not provided or paid by the lessor
The types, amounts, and estimated costs of recommended coverage even if not provided or paid by the lessor
The cost to the lessee NOTES
The cost to the lessee NOTES
No insurance disclosures are required
No insurance disclosures are required
Suggested answer: A
asked 16/09/2024
Kofi Amedorme
51 questions

Question 118

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The initial disclosure requires that certain disclosures relating to the termination of a lease be given to the consumer. Which of these disclosures is NOT required?

The conditions under which the lease may be terminated before the end of its term
The conditions under which the lease may be terminated before the end of its term
Whether or not the lessee has the option to purchase the property and at what price
Whether or not the lessee has the option to purchase the property and at what price
Whether the lease may be extended at the option of the lessee
Whether the lease may be extended at the option of the lessee
Whether the lessee will be liable for the difference between the estimated value of the property and its realized value at the termination or end of the lease
Whether the lessee will be liable for the difference between the estimated value of the property and its realized value at the termination or end of the lease
Suggested answer: C
asked 16/09/2024
Mauricio de Souza Penhalver Hollanda
52 questions

Question 119

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Roberta Milton's car lease with First National Bank reached its termination on August 1. Roberta and the bank agreed to extend the lease on a month-tomonth basis without charging her a fee for doing so. What disclosure responsibilities does the bank have now?

None are needed now.
None are needed now.
None, until after six months of the month-to-month lease
None, until after six months of the month-to-month lease
The bank must make an entirely new initial disclosure
The bank must make an entirely new initial disclosure
The bank must disclose the estimated residual value at the end of six months
The bank must disclose the estimated residual value at the end of six months
Suggested answer: B
asked 16/09/2024
Salman Hashmi
41 questions

Question 120

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First National's consumer leasing department placed an ad in the local paper that pictured a car with the caption, ''Sign a lease with us and pay only $275 per month.'' What other information must this ad have?

A statement that the transaction is not a loan
A statement that the transaction is not a loan
The total amount due at consummation or delivery, the number of payments required, and any required security deposit
The total amount due at consummation or delivery, the number of payments required, and any required security deposit
The bank's policy regarding the purchase of the property by the lessee
The bank's policy regarding the purchase of the property by the lessee
Disclosures regarding required insurance
Disclosures regarding required insurance
Suggested answer: B
asked 16/09/2024
Chengyang Zhang
50 questions
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