American Bankers Association CRCM Exam Practice Test Instant Access

Question 1

Cassandra Phillips requested a loan to purchase a boat. She asked for $15,000 at 7.5 percent for seven years. The bank considered her request but decided, considering her income and credit history, the best offer of credit the bank could make was $10,000 at 8.25 percent for five years. Rhonda Mays, the loan officer, wrote a letter, setting forth the terms the bank could offer. The letter was mailed on July 1. Ms. Phillips received the letter and began to look elsewhere for a loan on the terms and conditions she wanted. Does the bank have any additional responsibility to Ms. Phillips?

ANo. Because the bank made the offer of a loan, there is no further responsibility.

BNo. Because the customer decided to look elsewhere, there is no further responsibility.

CYes. The bank must follow up with a phone call to determine if Ms. Phillips is still interested.

DYes. The bank must send an adverse action notice because Ms. Phillips did not take the bank's counteroffer.

Answer : D

Question 2

First National Bancshares, Inc., a bank holding company, filed an application with its Federal Reserve Bank on March 1 to acquire a subsidiary bank. On March 15 the Federal Reserve Board asked First National for more information. On April 1 the Federal Reserve Bank received the completed application and accepted it. On April 5 the Federal Reserve Bank notified First National of the April 1 acceptance and referred the application to the Federal Reserve BoarD. Under the normal rules, by what date must the Federal Reserve Board act on the application?

AJune 1

BApril 30

CJune 5

DJuly 1

Answer : A

Question 3

Which of the following is/are NOT limitations on liability in EFT?

A$150 liability limit if consumer notifies the institution within two business days of discovery of loss or theft of access device, not including the day the consumer learns of the loss or theft

BIf state law has more generous limitations of liability for the consumer, the state laws will govern

CFull liability (up to the amount of the unauthorized transfer) may be imposed if the consumer does not notify the institution within 30 days of the institution's transmission of the statement on which the first unauthorized transfer appears (to raise the liability limit, the institution must first establish that the unauthorized transfers would not have occurred if the consumer had notified the institution within the 30 days). The unlimited liability applies only to the transactions that occur after the 30-day time period

DExtenuating circumstances (such as hospital confinements, travel, and so forth) may extend the liability time periods

Answer : A, D

Question 4

State National Bank offers credit life and disability insurance on all consumer loans. This credit-related insurance is sold by a third party, but the bank collects a commission on all sales. The bank also sells hazard insurance through its affiliated insurance agency. Which of the following actions is legal for State National?

ARequire all consumers to purchase credit life insurance through the bank

BRequire only certain consumers to purchase credit life insurance through the bank

CRequire all borrowers with real property loans to provide insurance to protect the collateral

DRequire borrowers on real estate loans over $50,000 to purchase hazard insurance through the bank

Answer : C

Question 5

Which of the following loans or applications is EXCLUDED from HMDA reporting?

AResidential loans purchased on the secondary market

BLoans secured by real estate that are made for purposes other than home purchase, improvement, or refinancing

CLoans on residential property in a flood zone when proof of flood insurance is not provided

DApplications for refinancing when there is no increase in principal

Answer : B

Question 6

James Walker DBA Walker Enterprises has been a customer of the bank for one month. The company told the bank that it would regularly make deposits in excess of $10,000 because it operates several laundromats in the city. The bank performed a background check on the company before opening the account. For its first 30 days, the company made 12 large cash deposits. Can the bank exempt this company now? Why or why not?

ANo. It is a not a corporation, but a sole proprietorship.

BNo. It has not maintained an account at the bank for 12 months.

CNo. It operates an ineligible business.

DYes. The bank conducted due diligence on the customer to determine that it had legitimate large cash transactions.

Answer : D

Question 7

State National Bank has a Web site on which it advertises all of its products. One page of the Web site is devoted to the products of its affiliate, State National Investment Products, InC. The affiliate sells uninsured mutual funds and various other investments not insured by the FDIC. What are State National's responsibilities for this advertising?

ANone. The affiliate is responsible.

BNone. Because it is a Web site, the advertising rules do not apply.

CThe bank must make sure the FDIC logo is properly placed.

DThe bank must make sure that the noninsured disclosures are on this page and that the FDIC logo does not appear.

Answer : D

American Bankers Association Certified Regulatory Compliance Manager CRCM Exam Practice Test