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Exam CRCM topic 1 question 26 discussion

Actual exam question from ABA's CRCM
Question #: 26
Topic #: 1
[All CRCM Questions]

Which of the following are recommended practices in Avoiding Predatory and Abusive Lending Practices in Brokered and Purchased Loans""AL-2003-3?

  • A. Have written agreements with third-party brokers that specifically and clearly address the rights and responsibilities of each party. Written agreements should 1. Ensure that no inappropriate compensation exists 2. Provide for indemnification to the bank 3. Enable banks to exit the arrangement through a termination procedure 4. Provide for the bank's and the OCC's ability to access all records of the third party and to audit the third party's operations
  • B. Verify that brokers and originators have established policies to ensure that loans will comply with all applicable laws
  • C. Establish an effective management information system to monitor the performance of third-party brokers and originators
  • D. All of the above
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Suggested Answer: D 🗳️

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Dex24
7 months ago
D, page 30
upvoted 1 times
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Cam22
8 months, 3 weeks ago
All the options listed are recommended practices for avoiding predatory and abusive lending practices in brokered and purchased loans, as outlined in the advisory letter AL-2003-3. These practices aim to ensure that banks maintain sound underwriting standards, legal compliance, and oversight when working with third-party brokers and loan originators, thus protecting both the banks and their customers from the risks associated with predatory lending.
upvoted 1 times
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JessyJazz24
1 year, 2 months ago
Selected Answer: D
Verify and stablishment will effectively grow and management will be honored
upvoted 1 times
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