CMP CMP - Certified Mortgage Processor Credit Analysis and Credit Reports Questions and Answers

Question 1

Which credit scoring model is most commonly used by mortgage lenders to evaluate borrower creditworthiness?

Accepted Answer

FICO Score

Answer

Mortgage lenders primarily use FICO Scores, which are required by Fannie Mae and Freddie Mac for conventional loan underwriting.

Question 2

When a mortgage processor pulls a tri-merge credit report, which three credit bureaus are included?

Accepted Answer

Experian, TransUnion, and Equifax

Answer

A tri-merge credit report combines data from Equifax, TransUnion, and Experian — the three major consumer credit bureaus.

Question 3

How is the qualifying credit score determined when there are three scores from a tri-merge credit report for a single borrower?

Accepted Answer

The middle score is used

Answer

For a single borrower, the middle (median) of the three bureau scores is used as the qualifying credit score.

Question 4

What is the minimum credit score typically required for a conventional conforming loan backed by Fannie Mae?

Accepted Answer

620

Answer

Fannie Mae generally requires a minimum credit score of 620 for conventional conforming loan eligibility.

Question 5

A mortgage credit report shows a collection account for $150. According to standard guidelines, how should the processor treat this when calculating qualifying ratios?

Accepted Answer

It can typically be ignored for conventional loans if it meets the de minimis threshold

Answer

Many conventional loan guidelines allow processors to disregard small collection balances that fall below the de minimis threshold without requiring payoff.

CMP - Certified Mortgage Processor Practice Test

CMP - Certified Mortgage Processor Practice Test

CMP CMP - Certified Mortgage Processor Credit Analysis and Credit Reports Questions and Answers