TN State Law Assignment 2 of 2

Please read the following Case Study and then answer the following multiple choice questions in the comments section below.

Keenen is a recent college graduate and after going through a simple interview process, has just gone to work for I-always-close Mortgage Company.  He was desperate to get a job, any job, and this small office promised him that he’d be making six figures within six months.  As the first college grad in his family, Keenen was anxious to prove himself and start paying back those college loans.

He had some concerns about the disorder in the shop on his first day but he told himself to just ignore it and focus on learning the business.  His manager told him he would be making loan modification loans for people, and would be helping them get out of bad situations as a result of the terrible economy.

After spending 20 minutes with his manager, Brandon, going over the application, he went back to his desk and started answering the phone.  Brandon told him he would eventually have to get a license but he wanted to train him first.  That sounded like a good idea to Keenen.

After several weeks training with the company, Keenen is approached by a woman named Janis yielding a flyer for I-always-close Mortgage Company advertising ARM mortgages, showing rates as low as 3%.  Janis explains her situation and said she is very interested in hearing more about these ARM Mortgages.

Keenen comes on a little strong and promises that he can get her a fixed rate of 3% no problem.  Janis is stunned considering how much lower this rate was from her previous quote at a different mortgage office.  A little curious as to why this office is offering such a low rate she asks Keenen what ARM stands for.  Keenen explains to her that ARM stands for Awesome Rate Mortgage, but tells her she will be receiving a fixed rate.

Janis cannot believe her good luck and decides to move along with Keenen and the Awesome Rate Mortgage.  She asks Keenen how soon they will be able to close.  Keenen tells her that he needs her to fill out a few forms to get her moving in the right direction.  He hands the forms over to her and says as soon as they are filled out he will get the ball rolling. 

When Janis looks down at the forms she notices that they are mostly blank.  Wanting to make sure that there wasn’t a mistake she tells Keenen the forms are blank and asks him what they are used for.  Keenen tells her not to worry about the blanks as he will fill them in for her later and assures her this is standard procedure.  Satisfied with Keenen’s response Janis signs the blank documents and turns them back over to Keenen who says he will get moving on this and that they will be at the closing table in no time at all.

1.    Is there anything wrong with Keenen wanting to help the Janis with her mortgage?

A.    No, Keenen earned his job at I-Always-Close Mortgage fair and square, and is able to help whomever he chooses

B.    No, Brandon, his manager told him it was ok to do so

C.   Yes, Keenen never got licensed

D.   None of the above

2.    Can Keenen offer an ARM at a fixed rate?

A.    Yes, that is why it so awesome

B.    No, he fraudulently misquoted the product, which is a prohibited act

C.   No, Keenen is still unlicensed, therefore should not be working on a loan for the woman

D.   Both B and C are correct

3.    Should Janis be satisfied with letting Keenen fill in the blank forms?

A.    No, It is a prohibited act to obtain any agreement or instrument in which blanks are left to be filled in after execution

B.    Yes, he is her MLO, that is his job

C.   None of the above

4.    Keenen committed multiple offenses while working on the loan for Janis.  What type of penalty is he subject to?

A.    Up to $5,000 for each offense

B.    Up to $10,000 for each offense

C.   $20,000 maximum

D.   Keenen is not subject to any penalties

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