Under the 'Equal Credit Opportunity Act' (ECOA), a Colorado lender may NOT deny a mortgage application based on:
Why B. Race, color, religion, national origin, sex, marital status, age, or because the applicant receives public assistance Is Correct
Answer B: B. Race, color, religion, national origin, sex, marital status, age, or because the applicant receives public assistance
Exam Tip: Finance
Finance questions often involve calculations. Master the T-bar method, understand the difference between conventional and government-backed loans, and know key ratios like LTV and DTI.
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Key Terms to Know
Prepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Math Concepts
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