NMLS SAFE Practice Test

NMLS SAFE Closing & Calculations Practice Questions

Closing & Calculations makes up 6 of every 50 questions on a Tigertest NMLS SAFE practice test. Here are 10 of the 24 questions on it, each with the answer and the reason.

Updated 2026-11-10 by the Tigertest team. Based on the NMLS SAFE MLO content outline. Original questions; 50 per test, weighted like the real 120-question test, 75% to pass. Not affiliated with NMLS.

1. 1. A $280,000 loan at 6% interest closes on June 21. Using a 360-day year, the prepaid interest the borrower owes through June 30 (10 days) is:

   • A.$460.27
   • B.$466.67
   • C.$46.67
   • D.$1,400.00

   Answer: B. Daily interest is $280,000 x 0.06 / 360 = $46.67, times 10 days = $466.67. Using a 365-day year gives $460.27.

2. 2. On a $250,000 fixed-rate loan at 6.6%, how much of the first monthly payment is interest?

   • A.$16,500
   • B.$1,250
   • C.$1,650
   • D.$1,375

   Answer: D. First-month interest is the balance times the annual rate divided by 12: $250,000 x 0.066 / 12 = $1,375. The rest of the payment reduces principal.

3. 3. A home sells for $385,000 with 5% down. What is the loan amount?

   • A.$365,750
   • B.$380,000
   • C.$19,250
   • D.$366,000

   Answer: A. The down payment is 0.05 x $385,000 = $19,250, so the loan is $385,000 - $19,250 = $365,750.

4. 4. An ARM's initial rate is 5.25% with a 2% first adjustment cap. At the first change the index is 4.6% and the margin is 2.75%. The new rate is:

   • A.6.85%
   • B.5.25%
   • C.7.25%
   • D.7.35%

   Answer: C. The fully indexed rate is 4.6% + 2.75% = 7.35%, but the 2-point cap limits the first change to 5.25% + 2% = 7.25%.

5. 5. A borrower's interest-only loan is $310,000 at 7.2%. The monthly interest-only payment is:

   • A.$1,680
   • B.$22,320
   • C.$1,860
   • D.$2,232

   Answer: C. Interest-only payment = $310,000 x 0.072 / 12 = $1,860. $22,320 is the annual interest, and $2,232 shifts the decimal.

6. 6. Annual PMI is quoted as 0.55% of a $300,000 loan. The monthly PMI payment is:

   • A.$137.50
   • B.$1,650.00
   • C.$55.00
   • D.$165.00

   Answer: A. Annual premium = 0.0055 x $300,000 = $1,650, divided by 12 = $137.50 a month.

7. 7. Mortgage interest is generally paid:

   • A.Only in the first year
   • B.In advance
   • C.At the end of the term
   • D.In arrears

   Answer: D. Each monthly payment covers interest for the previous month, which is why prepaid interest is collected at closing up to the first full month.

8. 8. On a refinance of a principal residence, when may the lender disburse the loan funds?

   • A.Within 24 hours of signing
   • B.After rescission ends
   • C.At the closing table
   • D.Before the documents are signed

   Answer: B. Funds on a rescindable loan may not be disbursed, other than into escrow, until the three-business-day rescission period has passed and the creditor is reasonably satisfied the consumer has not rescinded.

9. 9. Which title insurance policy protects only the lender's interest in the property?

   • A.Abstract of title
   • B.Lender's policy
   • C.Owner's policy
   • D.Hazard policy

   Answer: B. The lender's (loan) policy covers the mortgagee up to the loan balance and declines as the loan is paid. The owner's policy protects the buyer's equity.

10. 10. On the Closing Disclosure, the section that totals what the borrower must bring to closing is:

    • A.Loan Terms
    • B.Comparisons
    • C.Projected Payments
    • D.Cash to Close table

    Answer: D. The Calculating Cash to Close table compares the Loan Estimate and final figures and shows the cash the borrower needs at closing.