Question

Murphy is mortgage broker who has an ownership interest in a local title insurance company. When his clients apply for loans and request referrals to a title company, Murphy must:

a: Officer a list of all local title companies without steering loan applicants towards a particular one
b: Immediately provide an affiliated business arrangement disclosure if he refers them to the title company in which he has ownership interest
c: Offer a list of title companies that does not include the company in which he has an ownership interest
d: Explain to the loan applicants the he cannot refer them to a particular company

Answer 1

Murphy must immediately provide an affiliated business arrangement disclosure if he refers his clients to the title company in which he has an ownership interest.

Step-by-step explanation:

In this scenario, as Murphy has an ownership interest in a local title insurance company, he must disclose this information to his clients when they request referrals to a title company. Option b: Immediately provide an affiliated business arrangement disclosure if he refers them to the title company in which he has ownership interest is the correct answer. By providing this disclosure, Murphy ensures that his clients are aware of his ownership interest and can make an informed decision.