CMPS Client Assessment & Loan Structuring 2

Question 1

A self-employed borrower shows strong business revenue but minimal personal tax returns due to deductions. Which loan program best addresses this scenario?

Accepted Answer

Bank statement loan

Answer

Bank statement loans use 12-24 months of bank deposits to qualify self-employed borrowers instead of tax return income.

Question 2

When calculating a borrower's effective income from overtime pay, what is the standard documentation period required by most lenders?

Accepted Answer

2 years

Answer

Most lenders require a 2-year history of overtime pay and confirmation it is likely to continue to use it as qualifying income.

Question 3

A client wants to maximize cash flow after closing. Which loan structure best achieves this objective?

Accepted Answer

30-year fixed-rate mortgage

Answer

A 30-year fixed-rate mortgage produces the lowest required monthly payment, maximizing the borrower's retained monthly cash flow.

Question 4

Which of the following best describes the purpose of a loan comparison worksheet in the CMPS planning process?

Accepted Answer

To help clients evaluate multiple loan options side by side

Answer

A loan comparison worksheet allows clients to objectively compare costs, payments, and long-term financial impact of different mortgage options.

Question 5

A borrower has a DTI ratio of 48% and is applying for a conventional loan. What is the most appropriate next step for the mortgage planner?

Accepted Answer

Explore debt payoff scenarios or alternative loan programs that allow higher DTI

Answer

A planner should explore solutions such as paying down debt, increasing income documentation, or using programs with higher DTI thresholds before concluding the client cannot qualify.

(CMPS) Certified Mortgage Planning Specialist Practice Test

(CMPS) Certified Mortgage Planning Specialist Practice Test

CMPS Client Assessment & Loan Structuring 2