B2B: The Basics of Commercial Lending (2022)

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Question 1 of 10

1. Question
1. For the purposes of Regulation B, a completed application for a commercial loan is required to have 6 pieces of information which are the consumer’s name, the consumer’s income, the consumer’s social security number to obtain a credit report, the property address, an estimate of the value of the property, and the mortgage loan amount sought.
- a. True
- b. False
Question 2 of 10

2. Question
2. When a creditor receives an application for a consumer loan the creditor, by regulation, must:
- a. Deliver or place in the mail a loan estimate not later than the third business day after the creditor receives the consumer's application
- b. Deliver or place in the mail a loan estimate not later than the seventh business day before consummation of the transaction
- c. Be able to demonstrate a changed circumstance for certain charges that have increased by more than 10 percent after providing the first loan estimate
- d. None of the above
Question 3 of 10

3. Question
3. The Military Lending Act does not apply to commercial credit unless the credit is extended to and for an unincorporated business that generates less than $500,000 in gross revenue.
- a. True
- b. False
Question 4 of 10

4. Question
4. For the purposes of Regulation B and commercials loans
- a. An adverse action notice is not required but may be based on internal policy
- b. An adverse action notice is required but does not need to state any reasons for denial under any circumstance
- c. An adverse action notice can be delivered verbally only if the application was taken entire through the telephone
- d. An adverse action can be delivered in writing or verbally regardless of how the application was taken
Question 5 of 10

5. Question
5. When it comes to the Fair Credit Reporting Act (FCRA):
- a. The FCRA is not applicable to commercial loans in any manner
- b. Permissible purpose is not required for consumer reports for commercial loans
- c. The FCRA is applicable to consumer reports for commercial loans but only to primary borrowers for a commercial loan, not guarantors.
- d. The FCRA is applicable to consumer reports for commercial loans to all individuals who are personally liable on commercial credit.
Question 6 of 10

6. Question
6. The Flood Disaster Protection Act (FDPA):
- a. Requires all contents of a commercial structure to be insured, including the commercial structure itself, since the commercial structure and its contents are so inherently intertwined.
- b. Requires all contents of a commercial structure to be insured regardless of whether the commercial structure in which the contents are in is securing the loan.
- c. Requires contents of a commercial structure to be insured when the loan is secured by the contents and the commercial structure.
- d. None of the above.
Question 7 of 10

7. Question
7. For a bank’s Customer Identification Program (CIP), since a customer is a “person”, banks are not required to have a CIP as it is solely the bank’s discretion to have such a program in place:
- a. True
- b. False
Question 8 of 10

8. Question
8. What are maximum coverage limits in the Regular Program under the National Flood Insurance Program (NFIP) for a non-residential building?
- a. $500,000 for building coverage and $500,000 for contents coverage
- b. $250,000 for building coverage and $100,000 for contents coverage
- c. $250,000 for building coverage and $250,000 for contents coverage
- d. $500,000 for building coverage and $100,000 for contents coverage
Question 9 of 10

9. Question
9. Beneficial Ownership can apply to:
- a. Limited Liability Corporations, Limited Liability Partnerships, sole proprietorships, s-corps and c-corps
- b. Limited Liability Corporations, Limited Liability Partnerships, sole proprietorships, s-corps, c-corps, and unincorporated associations
- c. Limited Liability Corporations, Limited Liability Partnerships, s-corps, and c-corps
- d. Beneficial ownership does not apply to commercial credit
Question 10 of 10

10. Question
10. When can a bank require the signature of spouse on a commercial loan?
- a. Never
- b. Only when the borrowing spouse’s business is not creditworthy
- c. Only when the borrowing spouse is in a Community Property state
- d. Automatically if it is determined the borrower is married

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