SAFE MLO Fraud, Red Flags & Predatory Lending question: back after closing.

SAFE MLOFraud, Red Flags & Predatory Lending

A borrower's bank statement shows a $25,000 deposit three weeks before application. She says it is a gift from her uncle but mentions she will 'pay him back after closing.' How should this be treated?

A As a gift if the uncle signs a standard gift letter
B As a loan that must be disclosed and counted, not a gift
C As reserves that need no documentation
D As a gift, because a family member gave it

Show the answer and explanation

Answer: B. As a loan that must be disclosed and counted, not a gift

A gift may not be repaid; if repayment is expected, the funds are borrowed and must be disclosed as a debt, and the gift letter's 'no repayment' statement would be false (Fannie Mae Selling Guide, Chapter B3-4 (Asset Assessment)). Hiding the obligation is asset fraud. Source: Fannie Mae Selling Guide, Chapter B3-4 (Asset Assessment); 18 U.S.C. 1014 (as at 11 Oct 2026).

Common mistake

Accepting a gift letter when the borrower has said the money will be repaid.

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Original study material mapped to the public NMLS Content Outline; not a real test question.Not affiliated with or endorsed by NMLS, CSBS or SRR. Verify figures and rules against current guidance before relying on them.