Which entity is exempt from the Financial Institution Mortgage Financing Regulation Act?

The correct choice is that entities only originating closed-end first mortgages regulated by the Division of Real Estate are exempt from the Financial Institution Mortgage Financing Regulation Act. This exemption is significant because the act primarily targets entities engaging in broader mortgage financing activities that require regulatory oversight to protect consumers and ensure fair practices in lending. However, closed-end first mortgages typically have distinct characteristics and are overseen by dedicated regulations under the Division of Real Estate, which means they don't fall under the broader umbrella of the Financial Institution Mortgage Financing Regulation Act.

Closed-end mortgages are single, lump-sum loans where the borrower receives a specified amount upfront and makes regular payments until the loan is paid off, making them more straightforward and easier to regulate. The regulatory framework for these loans is already established, potentially eliminating the need for additional regulation under the act.