22 The Practice-of-Law Boundary Practice Questions & Answers

1. 1. During a refinance signing the borrower asks whether she would be better off waiving the escrow account and paying the property taxes herself. The agent's contract mentions only a ban on legal advice. How does the Code's advice prohibition actually apply here?

   • A.The prohibition covers legal advice alone, so a financial opinion about her escrow choice is acceptable.
   • B.The prohibition pauses whenever a borrower expressly asks the agent for a candid personal view.
   • C.The prohibition governs only written statements, so a spoken opinion at the table stays permissible.
   • D.The prohibition covers legal, personal, financial and other advice, so the question goes to the lender.✓ Answer

   The Code's core advice rule bars the signing agent from giving legal, personal, financial or any other advice to the signer, and from explaining the terms of any closing document. Because the ban is much wider than legal advice alone, an escrow question is routed to the lender's representative rather than answered.

   Source: SPW Notary Signing Agent Code of Conduct, advice to signersReport a problem with this question

2. 2. A borrower points at the promissory Note and asks, 'What interest rate did I end up with?' What may the signing agent do?

   • A.Decline the question outright and hand her the loan officer's phone number instead.
   • B.Compare the printed rate with the figure on her Loan Estimate and note any gap.
   • C.Tell her the rate is competitive for her credit profile and turn to the next page.
   • D.Point to the rate printed in the Note and read the figure as it appears there.✓ Answer

   The Code lets the agent identify and generally describe a loan term that already appears in the documents, and reading the printed rate is identification. Judging the rate, recalculating it or reconciling it with another document is interpretation, while a flat refusal is unnecessary because the figure is on the page in front of her.

   Source: SPW NSA Code of Conduct (Loan Terms)Report a problem with this question

3. 3. The borrower asks, 'Why is the APR on this disclosure higher than the rate on my Note?' What is the correct response?

   • A.Explain that the APR folds the loan's finance charges into the rate, then continue with the stack.
   • B.Identify the APR figure on the disclosure, say you may not interpret it, and refer her to the loan officer.✓ Answer
   • C.Work the difference between the two figures out on paper so that she can follow the arithmetic.
   • D.Assure her that a gap between the two numbers is normal on every mortgage loan of this kind.

   Identifying a term such as the APR is permitted, but saying why two figures differ explains and interprets the term, which the Code forbids. Doing the arithmetic for the borrower goes further still, because it supplies analysis that is not printed in the documents at all.

   Source: SPW NSA Code of Conduct (Loan Terms)Report a problem with this question

4. 4. Looking at the Closing Disclosure, the borrower says, 'These closing costs are far more than I expected — why are they so high?' What does the Code call for?

   • A.Name the fee on the Closing Disclosure and refer the question to the closing agent.✓ Answer
   • B.Break down which of the itemized charges are lender fees and which are title fees.
   • C.Suggest that she hold off on signing until she has priced the same services elsewhere.
   • D.Tell her the total looks about average for a refinance of this size in her area.

   The Code lets the agent identify and generally describe a fee or charge shown on the Closing Disclosure, HUD-1 or other closing statement, but not explain, interpret or advise about it. Why a charge is the amount it is belongs to the lender's representative or the closing agent, and steering the borrower away from signing is a separate violation.

   Source: SPW NSA Code of Conduct (Settlement Fees)Report a problem with this question

5. 5. A borrower asks what a paragraph in the Deed of Trust means. Under the Code, which pair of responses is open to the signing agent?

   • A.Giving your own reading of the paragraph, or noting that the wording is standard in every deed of trust.
   • B.Pointing her to the provision that may answer it, or referring her to the lender or closing agent.✓ Answer
   • C.Marking the paragraph for her to research later, or offering to call a real estate agent you know.
   • D.Paraphrasing the paragraph in plain words for her, or referring her to the service that dispatched the job.

   The Code allows exactly two responses to a signer's question: directing the signer to the provision in the closing document that may answer it, or referring the signer to the lender's representative or the closing agent. A signing service dispatcher is not a permitted referral target, because it has no standing to speak about the loan.

   Source: SPW NSA Code of Conduct (Response to Questions)Report a problem with this question

6. 6. At what point must the signing agent tell the parties that he provides signing services only and cannot answer questions about the transaction or the legal effect of the documents?

   • A.At the end, when he hands the borrower her copies of the completed package.
   • B.At contract signing with the hiring company, rather than before the borrower.
   • C.At the start of the appointment, while the signing space is being prepared.✓ Answer
   • D.At the first question the agent turns out not to be permitted to answer.

   The Code makes this an affirmative, up-front disclosure of role and limitations rather than a reaction to an awkward question. Explaining the limits while the signing space is being prepared means the borrower knows, before the first document, which questions must be taken to the lender or closing agent.

   Source: SPW NSA Code of Conduct (Role and Limitations)Report a problem with this question

7. 7. An agent arrives at a closing with the title company's phone number but no contact information for the lender's representative. What does the Code require before the signing begins?

   • A.Start the documents now and get the lender's number from the title company if needed.
   • B.Open the package and give the borrower the signing service's dispatch line instead.
   • C.Wait to begin the signing until he also has the lender representative's contact details.✓ Answer
   • D.Proceed with the appointment, since the closing agent's information satisfies the requirement.

   The Code makes contact information for both the lender's representative and the closing agent a precondition to commencing the appointment, not something to chase down mid-signing. Having both in hand is what lets the agent route a loan question the moment it is asked instead of improvising an answer.

   Source: SPW NSA Code of Conduct (Contact Sources)Report a problem with this question

8. 8. Midway through the package a borrower asks who can actually explain her loan terms to her. What does the Code require the signing agent to do with the contact information he collected?

   • A.Pass along the title company's number and leave the lender's out of the conversation entirely.
   • B.Share the numbers with her only if she asks for them a second time during the appointment.
   • C.Hand the borrower the lender representative's and the closing agent's details as a required step.✓ Answer
   • D.Keep those numbers for his own use and call them himself if an issue comes up at the table.

   Obtaining the contacts and disclosing them are two separate duties. The Code requires the agent to give the borrower the lender representative's and closing agent's information, because those are the parties permitted to answer loan questions and explain the closing documents.

   Source: SPW NSA Code of Conduct (Disclosure of Contact Sources)Report a problem with this question

9. 9. A borrower hesitates and says she would like more time to read everything. The loan is a refinance carrying a right to cancel. What should the signing agent do?

   • A.Recommend that she call the lender's representative now, before she signs anything.✓ Answer
   • B.Suggest she sign tonight because the three-day cancellation window lets her back out.
   • C.Explain how the cancellation period runs so that she feels comfortable going ahead.
   • D.Reschedule the appointment on his own and tell her to come back to it another day.

   The Code expressly forbids recommending that a borrower go ahead on the ground that the rescission option leaves three business days to read, ask and decide, however reassuring that sounds. The required move is to recommend that she contact the lender's representative immediately, before signing.

   Source: SPW NSA Code of Conduct (Exercise of Rescission Option)Report a problem with this question

10. 10. The signing agent privately thinks the rate on this loan is high. The borrower asks him, 'Honestly — is this a good deal for me?' What is the proper handling?

    • A.Answer that the deal looks fair, because a neutral reassurance is not an opinion.
    • B.Say nothing about the rate at all and turn the page without acknowledging her.
    • C.Share his honest view, since candour about a poor deal protects the borrower from harm.
    • D.State the rate as printed and send the question about its merits to the loan officer.✓ Answer

    The Code bars any personal opinion to a signer about executing the documents or consummating the transaction, even an opinion the agent believes is true and helpful, because the agent must remain impartial. Identifying the printed rate is allowed; grading it is not, and the borrower is referred rather than ignored.

    Source: SPW NSA Code of Conduct (Personal Opinion)Report a problem with this question

11. 11. A signing service dispatcher telephoned the agent and said the loan will fund on Thursday. At the table the borrower asks when her money will actually arrive. What should the agent do?

    • A.Tell her he may not forecast funding and send the question to the closing agent.✓ Answer
    • B.Repeat Thursday, since the dispatcher who assigned the job cleared him to say it by phone.
    • C.Promise the funds will move as soon as the county records the security instrument.
    • D.Estimate a date from the cancellation period printed on the notice she just signed.

    The Code bars the agent from forecasting or disclosing a disbursement or funding date unless a lender's representative or the closing agent has expressly requested it in writing, or the date is clearly identified in a closing document the agent may present. A verbal go-ahead from a signing service dispatcher meets neither condition.

    Source: SPW NSA Code of Conduct (Disbursement or Funding Date)Report a problem with this question

12. 12. Two days after the closing the borrower texts the agent: 'Should I have shopped a different lender for a better rate?' How should he handle the message?

    • A.Reply that lenders and rates are her loan officer's subject, and leave it at that.✓ Answer
    • B.Give a general opinion about rate shopping without naming any particular mortgage company.
    • C.Name a couple of lenders known for better rates, given that her loan has already funded.
    • D.Answer by text, because the restriction covers the appointment itself and not later messages.

    The Code forbids advising a borrower about loan products, programs, competing rates or mortgage professionals in any verbal or written communication connected with the assignment. A follow-up text is covered exactly as the table is, and a general opinion about shopping is still advice even with no company named.

    Source: SPW NSA Code of Conduct (Loan Programs and Professionals)Report a problem with this question

13. 13. A signing agent is also a licensed attorney, but he represents no party in this transaction. The borrower asks him for legal advice about a clause in the Mortgage. What should he do?

    • A.Advise her on the clause after noting that counsel, not the signing agent, is speaking.
    • B.Refer her to her own counsel, since the carve-out covers an attorney representing a party.✓ Answer
    • C.Provide the advice once the borrower signs a waiver stating that no fee is charged.
    • D.Answer the question, since a licensed attorney is exempt from the ban at any signing table.

    The Code allows legal advice during a signing in one situation only: the signing agent is an attorney who represents a party in that transaction. An attorney present solely as the signing agent stands in the same position as any other agent, and a disclaimer or a fee waiver does not create the exception.

    Source: SPW NSA Code of Conduct (Legal Advice)Report a problem with this question

14. 14. The agent reaches the Deed of Trust in the stack. Which combination stays inside identifying and presenting the document rather than explaining it?

    • A.Its name, the reason the lender demands it, its recording fee, and the certificate wording.
    • B.Its name, its general purpose, how many pages it runs, and where to sign, date or initial.✓ Answer
    • C.Its name, its general purpose, and the agent's view of how it protects the lender's money.
    • D.Its name, a summary of each covenant, its page count, and the effect of the default clause.

    The Code sets four elements for presenting each closing document: name it, state its general purpose, give the number of pages, and indicate where signatures, dates or initials go. Summarizing covenants or describing what a clause would do legally goes beyond the general description and becomes explanation.

    Source: SPW NSA Code of Conduct (Presentation of Documents)Report a problem with this question

15. 15. A document in the package carries no notarial certificate wording, and the borrower asks the agent to pick the right one. What is the correct course?

    • A.Show sample acknowledgment and jurat wording and let the signer choose which applies.✓ Answer
    • B.Choose the jurat, because an oath gives the lender the stronger form of protection.
    • C.Select the acknowledgment, as that is the usual certificate on mortgage paperwork.
    • D.Draft wording that fits the document and enter it so that the package can go out today.

    Under the unauthorized practice of law article of the notary code of professional responsibility, a notary who is not an attorney must not determine or prescribe which notarial act or certificate a document requires. Showing sample acknowledgment and jurat wording, or referring the question to the receiving agency or an attorney, leaves the choice with the principal.

    Source: NNA Notary Public Code of Professional Responsibility, Article B (unauthorized practice of law)Report a problem with this question

16. 16. Which item in a residential loan package may the signing agent himself complete?

    • A.The blank line for the borrower's current mailing address on the occupancy affidavit.
    • B.The date left blank on a notarial certificate, to be filled in once the loan funds.
    • C.The identification verification form required by the USA PATRIOT Act, signed as Signing Agent.✓ Answer
    • D.The employment section of the loan application, using details the borrower reads out.

    A notary must not prepare a document for another person or help complete its blanks, and a notarial certificate is never left blank or dated other than the day the act is performed. The customer identification form used under the USA PATRIOT Act is the rare item the signing agent completes, and he enters the title Signing Agent rather than Notary Public.

    Source: NNA Notary Public Code of Professional Responsibility, Article B; USA PATRIOT Act customer identification formReport a problem with this question

17. 17. A document that must be notarized has an empty blank in it, and the borrower says, 'Just write in whatever you think belongs there.' What should the agent do?

    • A.Contact the contracting company about the blank before completing the notarization.✓ Answer
    • B.Line through the empty space in ink and go ahead with the notarial certificate.
    • C.Notarize the document as it stands and flag the blank on the shipping summary.
    • D.Enter the information the borrower dictates and then notarize the finished document.

    The Code directs the agent to contact the contracting company whenever a document requiring notarization is incomplete or contains blank spaces. Deciding what belongs in a blank would amount to preparing the document for the signer, and striking through or altering it is not the agent's call either.

    Source: SPW NSA Code of Conduct (incomplete documents and blank spaces)Report a problem with this question

18. 18. Which of these questions from the borrower may the signing agent answer himself?

    • A.The number of documents still left in tonight's signing package.✓ Answer
    • B.The risk that her monthly payment rises after the escrow review.
    • C.The reason the lender requires flood insurance on this property.
    • D.The cost of the prepayment provision if she refinances next year.

    Questions about the mechanics of the appointment — how many documents remain, where to sign, how long it will take — concern the signing service the agent actually provides, so he may answer them. Questions about payments, escrow, prepayment cost or why the lender imposes a requirement are loan questions and go to the lender's representative or the closing agent.

    Source: SPW NSA Code of Conduct, responses to questions; loan termsReport a problem with this question

19. 19. The borrower asks, 'What actually happens if I miss a payment on this loan?' What is the correct response?

    • A.Summarize the lender's remedies so she grasps the risk before signing the Note.
    • B.Point to the default paragraph in the Note and refer her to the lender's representative.✓ Answer
    • C.Tell her a single late payment rarely brings anything beyond a fee and a phone call.
    • D.Recommend she initial that paragraph to show she read it, then move on with the stack.

    The Code permits directing the signer to the provision that may answer her question — here the default section of the Note — or referring her to the lender's representative or the closing agent. Summarizing what the lender could do on default describes legal effect, which is explanation rather than identification.

    Source: SPW NSA Code of Conduct (Response to Questions); default provision of the promissory NoteReport a problem with this question

20. 20. The borrower compares the Note with a rate she was quoted by phone weeks ago and asks, 'Is this the rate I was promised?' What should the agent do?

    • A.Assure her that lenders rarely move a locked rate between the quote and the closing day.
    • B.Set the Note aside and work through the rest of the package while she telephones her broker.
    • C.Compare the printed rate with the Loan Estimate in her folder and confirm whether they agree.
    • D.Read the rate as printed, say that comparing it to a quote is for the lender, and give her the number.✓ Answer

    Identifying the rate that appears in the document is permitted, but reconciling it against something the borrower was told elsewhere is interpretation and relies on information outside the package. That question is routed to the lender's representative, whose contact details the agent is already required to hand over.

    Source: SPW NSA Code of Conduct, loan terms; responses to questions; contact sourcesReport a problem with this question

21. 21. An agent, meaning only to be helpful, explains what an acceleration clause would do to the borrower. What is the significance of that under professional standards and general law?

    • A.It is an incumbent breach of his contract with the signing service and carries no other risk.
    • B.It is acceptable whenever the borrower asks first and the agent keeps the answer short.
    • C.It is unauthorized practice of law, unlawful everywhere and a risk to his commission.✓ Answer
    • D.It is a problem only where the borrower later suffers a documented financial loss.

    Explaining the legal effect of a closing document is the unauthorized practice of law, which is prohibited in every state and can expose the notary to loss of the commission, civil liability and criminal penalty. It is far more than a contract issue, and the harm does not depend on the borrower proving a later loss; the closing itself can be delayed or unwound.

    Source: SPW NSA Code of Conduct; state prohibitions on the unauthorized practice of lawReport a problem with this question

22. 22. Presenting the Notice of Right to Cancel, the borrower asks, 'And what happens to me if I do cancel?' What is the correct handling?

    • A.Tell her cancelling would leave her exactly where she stood before tonight's meeting.
    • B.Advise her to sign tonight and use the cancellation window later if she changes her mind.
    • C.Walk her through how the loan would unwind so she can weigh cancelling against signing.
    • D.Name it as the notice of her right to cancel within the stated period, then refer her.✓ Answer

    The agent may name the document and give its general description — notice of the borrower's right to cancel the transaction within a stated time frame — and then route the question to the lender's representative or closing agent. Describing the consequences of cancelling interprets legal effect, and urging her to sign because the window exists is separately prohibited.

    Source: SPW NSA Code of Conduct; Notice of Right to Cancel under Regulation Z, 12 CFRReport a problem with this question

Practice questions based on the Notary Signing Agent Code of Conduct and standard residential mortgage closing documents. This site is not affiliated with or endorsed by the National Notary Association. IMPORTANT: the real certification exam also covers your own state's notary laws and procedures, and this bank deliberately does not — notary commissioning, fees, journal and seal requirements, acceptable identification and remote online notarization are set state by state and vary widely. Study your state's notary handbook alongside this, and see our Notary Public practice test for the notarial acts themselves. Being a certified signing agent does not by itself authorize you to notarize anywhere; your state commission does. About signing agent certification →