Quiz for B2B: Loan Officer Compensation

1. The loan officer compensation rules found in 1026.36 apply to both closed-end and open-end lending:

2. A loan officer is someone who:

3. All of the following are prohibited compensation practices except:

4. Loan officers can be originated based on all of the following except:

5. A proxy is a factor that consistently varies with the term over several transactions. Importantly, if it is a proxy, the originator can add, drop, or change that factor.

6. A loan originator may not receive compensation, directly or indirectly, from any person other than the consumer. The only exception is that a loan originator organization may compensate individual loan originators in connection with a transaction subject to the other prohibitions.

7. A loan originator may not steer a consumer based on the loan originator receiving more money for that type of product. There is a safe harbor of compliance with this rule if the LO gives the consumer an options list that includes a loan with:

8. The name and NMLSR ID of both the loan originator organization and the individual loan originator primarily responsible for the origination must be on which of the following loan documents:

9. Bonuses to loan officers based on the overall profitability of the bank’s loan portfolio are generally prohibited unless they fall into an exception.

10. A loan officer can receive compensation in the form of a contribution to a defined contribution plan or defined benefit plan that is based on the terms of multiple transactions by multiple individual loan originators.