Loan Officer Practice Exam

Which entity oversees nonbank mortgage originators and private lenders?

1. Consumer Financial Protection Bureau

2. Office of Financial Regulation

3. National Credit Union Administration

4. Federal Housing Finance Agency

The correct answer is: Consumer Financial Protection Bureau

The Consumer Financial Protection Bureau (CFPB) is the correct answer because it is the primary federal agency responsible for overseeing and enforcing consumer protection laws in the financial sector, which includes nonbank mortgage originators and private lenders. The CFPB was created in the aftermath of the 2008 financial crisis to promote fairness and transparency for mortgage borrowers. It regulates mortgage lending practices to ensure that these entities comply with consumer protection laws, thereby helping protect consumers from unfair, deceptive, or abusive practices. The other entities mentioned in the choices have distinct roles that do not primarily focus on nonbank mortgage originators or private lenders. For instance, while state-level offices like the Office of Financial Regulation may oversee certain aspects of local financial practices, they do not have the same broad federal authority as the CFPB. The National Credit Union Administration focuses on federal and state chartered credit unions rather than mortgage originators and lenders. Lastly, the Federal Housing Finance Agency primarily oversees government-sponsored enterprises such as Fannie Mae and Freddie Mac, not nonbank entities.