CRMP Borrower Qualification Requirements 5

Question 1

A borrower's home has been cited for health and safety deficiencies in the FHA appraisal. What must happen before the HECM closes?

Accepted Answer

Required repairs must be completed and re-inspected, or repair set-asides must be established at closing

Answer

FHA requires that health-and-safety repair items be addressed either before closing or through an escrow/set-aside arrangement managed by the servicer.

Question 2

Which statement about condominiums and HECM eligibility is correct?

Accepted Answer

Only FHA-approved condominium projects are eligible for HECM, or units in projects that receive spot approval

Answer

HECM eligibility for condos requires the project to be on HUD's approved condominium list or to receive single-unit (spot) approval under FHA guidelines.

Question 3

Under the Non-Borrowing Spouse (NBS) Deferral Policy, what is required for the NBS to remain in the home after the borrower's death?

Accepted Answer

The NBS must have been legally married to the borrower at loan closing and continue to occupy the home as their primary residence

Answer

HUD's NBS Deferral Policy requires the NBS to have been married to the borrower at loan origination and at the time of death, and to continue living in the home as their primary residence.

Question 4

An applicant has a credit score of 580 but no history of delinquent property charges. How is this handled under HECM Financial Assessment?

Accepted Answer

HECM has no minimum credit score; the FA focuses on property charge payment history and residual income

Answer

Unlike conventional loans, HECM Financial Assessment does not use a minimum credit score threshold; instead it evaluates property charge history and residual income capacity.

Question 5

What is the maximum period a HECM borrower may be absent from their home for non-medical reasons before the loan becomes due and payable?

Accepted Answer

6 consecutive months

Answer

For non-medical absences, the HECM becomes due and payable if the property is not occupied as a primary residence for more than 6 consecutive months.

(CRMP) Certified Reverse Mortgage Professional Practice Test

(CRMP) Certified Reverse Mortgage Professional Practice Test

CRMP Borrower Qualification Requirements 5