CRMP Client Assessment and Eligibility 2

Question 1

A borrower is 68 years old and owns a home with a $40,000 remaining mortgage balance valued at $280,000. What must occur before HECM proceeds can be accessed?

Accepted Answer

The existing mortgage must be paid off at or before closing

Answer

The existing mortgage must be refinanced into a fixed-rate loan

Answer

The borrower must wait 12 months after paying off the existing mortgage

Answer

The existing mortgage must be subordinated to the HECM lien

Question 2

Which scenario would cause a borrower to FAIL the residency requirement for a HECM?

Accepted Answer

Spending 7 months per year at the mortgaged property

Answer

Temporarily residing in a rehabilitation facility for 4 months

Answer

Vacationing abroad for 2 months each year

Answer

Renting a room in the home to a family member

Question 3

When assessing a married couple for a HECM, one spouse is 72 and the other is 59. How does this affect eligibility?

Accepted Answer

Only the 72-year-old can be on the loan; the 59-year-old is an eligible non-borrowing spouse

Answer

Both must be at least 62 to qualify, so the couple is ineligible

Answer

The younger spouse's age is averaged with the older to determine the principal limit

Answer

The 59-year-old must be removed from the title before closing

Question 4

A client discloses they have a federal tax lien on their property. What is the likely impact on HECM eligibility?

Accepted Answer

The lien must be resolved or subordinated before the HECM can close

Answer

Federal tax liens are automatically subordinated to HECM loans

Answer

The loan is permanently disqualified due to the federal lien

Answer

The borrower must pay the lien within 12 months after closing

Question 5

Under the HECM financial assessment, which factor is NOT evaluated by the lender?

Accepted Answer

The borrower's credit score threshold of 700 or higher

Answer

History of property charge payments such as taxes and insurance

Answer

Residual income after accounting for monthly obligations

Answer

Previous bankruptcy or foreclosure records

Question 6

A borrower has a manufactured home built in 1974. Which statement best describes HECM eligibility for this property?

Accepted Answer

It is ineligible because manufactured homes must have been built on or after June 15, 1976

Answer

It qualifies as long as it meets current safety standards

Answer

It qualifies if it has been permanently affixed to the land for 10+ years

Answer

It is ineligible because all manufactured homes are excluded from HECM

Question 7

During client assessment, a CRMP discovers the borrower receives SSI benefits. What concern should the professional raise?

Accepted Answer

HECM disbursements could affect SSI means-tested benefit eligibility if funds are not spent within the same month

Answer

SSI recipients are categorically excluded from HECM programs

Answer

SSI income cannot be counted as stable income in the financial assessment

Answer

HECM proceeds are always counted as income by the SSI program