Skip to content

GROUP MANAGEMENT

Home
Courses
About Kathy Lewis
Refund Policy
Contact

Home
Courses
About Kathy Lewis
Refund Policy
Contact

P4-106 Quiz

Time limit: 0

Quiz Summary

0 of 7 Questions completed

Questions:

Information

You have already completed the quiz before. Hence you can not start it again.

Quiz is loading…

You must sign in or sign up to start the quiz.

You must first complete the following:

Results

Quiz complete. Results are being recorded.

Results

0 of 7 Questions answered correctly

Your time:

Time has elapsed

You have reached 0 of 0 point(s), (0)

Earned Point(s): 0 of 0, (0)
0 Essay(s) Pending (Possible Point(s): 0)

Categories

Not categorized 0%

Review
Answered
Correct
Incorrect

Question 1 of 7

1. Question

What fundamental requirement underlies all Ability-to-Repay (ATR) scenarios?

Borrowers must be able to repay the mortgage
Correct Incorrect Correct answer

Borrowers must have a minimum credit score
Correct Incorrect Correct answer

Borrowers must have cash reserves
Correct Incorrect Correct answer

Borrowers must occupy the property
Correct Incorrect Correct answer

Correct

Incorrect
Question 2 of 7

2. Question

What must lenders evaluate to ensure compliance with the Ability-to-Repay rule?

The property’s resale value
Correct Incorrect Correct answer

The borrower’s residual income only
Correct Incorrect Correct answer

The borrower’s available income and assets
Correct Incorrect Correct answer

The borrower’s loan-to-value ratio
Correct Incorrect Correct answer

Correct

Incorrect
Question 3 of 7

3. Question

Why must borrowers provide documentation as part of the ATR analysis?

To establish property eligibility
Correct Incorrect Correct answer

To demonstrate income and asset availability
Correct Incorrect Correct answer

To qualify for a lower interest rate
Correct Incorrect Correct answer

To reduce lender liability
Correct Incorrect Correct answer

Correct

Incorrect
Question 4 of 7

4. Question

Which of the following is an example of acceptable documentation for ATR purposes?

Personal budget worksheet
Correct Incorrect Correct answer

Bank statements and tax returns
Correct Incorrect Correct answer

Credit counseling certificate
Correct Incorrect Correct answer

Appraisal report
Correct Incorrect Correct answer

Correct

Incorrect
Question 5 of 7

5. Question

What practice regarding teaser rates is prohibited under Ability-to-Repay rules?

Offering teaser rates on adjustable-rate mortgages
Correct Incorrect Correct answer

Disclosing teaser rates without APR
Correct Incorrect Correct answer

Charging interest-only payments
Correct Incorrect Correct answer

Masking the true cost of the loan using teaser rates
Correct Incorrect Correct answer

Correct

Incorrect
Question 6 of 7

6. Question

Why may lenders not measure a borrower’s ability to repay using a teaser rate?

Teaser rates violate RESPA
Correct Incorrect Correct answer

Teaser rates are illegal
Correct Incorrect Correct answer

Teaser rates do not reflect the long-term loan obligation
Correct Incorrect Correct answer

Teaser rates increase default risk automatically
Correct Incorrect Correct answer

Correct

Incorrect
Question 7 of 7

7. Question

How must lenders measure a borrower’s ability to repay an adjustable-rate mortgage?

Based on the initial introductory rate
Correct Incorrect Correct answer

Based on the rate in effect for the first 12 months
Correct Incorrect Correct answer

Based on the lowest possible interest rate
Correct Incorrect Correct answer

Based on the long-term interest rate applicable to the loan
Correct Incorrect Correct answer

Correct

Incorrect

5784 Lake Forest Dr. Suite 280
Atlanta, GA 30328
(888) 254-3431
support@capinst.com

Facebook X-twitter

Copyright 2026 Capstone Institute
All Rights Reserved
Terms and Conditions
Privacy Policy
Our Blog

ABOUT CAPSTONE INSTITUTE

As one of the very first mortgage education centers, Capstone and our instructors have helped set the standard for mortgage education, training and preparation for industry-related exams.

How to Become a Mortgage Loan Officer
Mortgage Education Blog
Mortgage Education
FHA Training
Glossary of Terms
NMLS Licensing Guide 2025
Mortgage Training Courses Atlanta
20-Hour Mortgage NMLS Pre-License Training
MLO Career Guide
NMLS Pre-License Requirements 2026

Answering Questions From Future MLOs