Practice Test Geeks(CRMP) Certified Reverse Mortgage Professional Practice Test
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Financial Assessment & Borrower Eligibility Flashcards

7 cards from real CRMP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Financial Assessment & Borrower Eligibility flashcards as text

  1. Which of the following income types is given the LEAST weight in a HECM financial assessment because it is not guaranteed to continue?

    Answer: Part-time employment wages

    Part-time employment wages are considered less stable and least likely to continue long-term compared to fixed retirement income sources like Social Security or pensions.

  2. During a HECM financial assessment, the lender discovers the borrower has an outstanding federal tax lien. What is required?

    Answer: The lien must be paid in full before or at closing, or a repayment plan must be in place

    Federal tax liens must be satisfied at or before closing, or the borrower must have an approved IRS repayment agreement in place.

  3. What residual income benchmark does HUD use as a reference when evaluating HECM applicants?

    Answer: VA loan residual income tables by region and family size

    HUD's HECM financial assessment references VA loan residual income tables, adjusted by region and family size, as a benchmark.

  4. A borrower owns a home in a flood zone. How does this affect HECM eligibility from a financial assessment standpoint?

    Answer: Flood insurance premiums must be factored into the ongoing property charge obligations

    Flood insurance is a mandatory property charge for homes in flood zones and must be included when calculating the borrower's ability to sustain property charges.

  5. Which of the following scenarios would result in a 'satisfactory' credit determination under HUD's financial assessment?

    Answer: No late housing or installment payments in the past 12 months with no major derogatory history in 24 months

    HUD's satisfactory credit standard generally requires no late housing payments in 12 months and no major derogatory events in 24 months.

  6. If a HECM borrower has a fully funded LESA, what is the borrower's ongoing obligation for property charges?

    Answer: The servicer pays property charges from the LESA funds on the borrower's behalf

    With a fully funded LESA, the servicer administers payments for taxes and insurance directly from the set-aside account, removing that obligation from the borrower.

  7. What minimum age must ALL borrowers on the title meet to qualify for a HECM?

    Answer: 62 years old

    All borrowers listed on the HECM must be at least 62 years of age at the time of loan closing to qualify.