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Banking CRCM Exam
CERTIFIED REGULATORY COMPLIANCE MANAGER (CRCM) (Page 8 )

Updated On: 12-Jan-2026
Page 8 of 276
PDF with 463 Questions

is frequent refinancing that do not benefit the borrower. This practice can result in borrower injury from the fees imposed and from the fact that it decreases home equity and increases the consumer's debt burden, thus increasing the chance of foreclosure.

  1. Loan flipping
  2. Loan refinancing
  3. Securitization
  4. Subprime loans

Answer(s): A



Which of the following usually comes under the heading of abusive lending?

  1. Abusive lending usually is defined by a variety of lending practices
  2. It is the excessive and hidden fees in the amount financed
  3. A fundamental characteristic is aggressive marketing of credit to prospective borrowers who cannot repay it on the terms offered
  4. Typically, such loans are underwritten on the liquidation value of the collateral rather than the creditworthiness of the borrower

Answer(s): A,C,D



The purpose of guidelines for National Banks to Guard against Predatory and Abusive Lending Practices- AL-2003-2 includes all of the following EXCEPT:

  1. Provide examples to national banks of practices that may be abusive
  2. Advise banks on how they should avoid abusive practices
  3. Banks should consider appropriate discount rates, credit loss rates, and prepayment rates when valuing these assets
  4. Show how some abusive lending can involve unfair or deceptive practices and therefore violate the Federal Trade Commission Act

Answer(s): C



Under Interagency Guidance on Subprime Lending (1999) lending policy must:

  1. Be appropriate to the size and complexity of the operation
  2. Address the types of products offers and those not authorized
  3. Require credit file documentation
  4. All of these

Answer(s): D



The banking agencies issued two guidances to caution depository institutions about risks involved in funding non-depository lenders that engage in predatory lending. Predatory and abusive practices include:

  1. High-pressure sales
  2. Excessive fees and interest rate including fees for unnecessary products
  3. Balloon payments that may never cause foreclosures
  4. Excessive refinancing with fees included in the new loan

Answer(s): A,B



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