CRMP Ethics and Professional Conduct 4

Question 1

Under NRMLA standards, a CRMP who learns of potential elder financial abuse during the application process should:

Accepted Answer

Pause the transaction and report to Adult Protective Services or appropriate authorities

Answer

Complete the loan transaction and report abuse afterwards

Answer

Confront the suspected abuser directly before taking other action

Answer

Obtain written consent from the borrower before reporting

Question 2

What does the NRMLA Code of Ethics require regarding advertising and marketing for reverse mortgages?

Accepted Answer

Marketing must be accurate, not misleading, and include required disclosures about loan costs and obligations

Answer

Ads may emphasize benefits without disclosing limitations to keep messaging positive

Answer

Testimonials from satisfied borrowers are sufficient disclosure of product risks

Answer

Marketing is governed solely by state law, not NRMLA standards

Question 3

A non-borrowing spouse is not on the title of the property. What is the CRMP's ethical duty regarding their interests?

Accepted Answer

Explain deferral protections and potential displacement risks to both spouses

Answer

Focus solely on the borrowing spouse as the client of record

Answer

Advise the non-borrowing spouse to consult a separate lender

Answer

Limit communication to the borrowing spouse to respect privacy

Question 4

A CRMP holds a CRMP designation from NRMLA. Which conduct would put that designation at risk?

Accepted Answer

Engaging in undisclosed dual agency by representing both borrower and lender interests

Answer

Completing continuing education requirements on time

Answer

Referring clients to HUD-approved counselors before closing

Answer

Disclosing all compensation received from lenders

Question 5

How should a CRMP handle a borrower who speaks limited English and relies on a family member for translation?

Accepted Answer

Use a qualified independent translator or translated documents to ensure accurate communication

Answer

Accept the family member as an adequate translator to streamline the process

Answer

Proceed if the borrower can sign their name in English

Answer

Recommend the borrower seek a lender who speaks their language

Question 6

What ethical principle is violated when a CRMP omits mention of rising loan balances and potential equity erosion when presenting a reverse mortgage?

Accepted Answer

Principle of full disclosure and transparency

Answer

Principle of efficiency

Answer

Principle of regulatory compliance only

Answer

Principle of professional brevity

Question 7

A CRMP who is also a licensed financial advisor recommends a reverse mortgage to fund an annuity product they sell. This situation most likely represents:

Accepted Answer

A serious conflict of interest requiring full disclosure and possibly recusal

Answer

An efficient cross-selling strategy benefiting the client

Answer

A normal dual-role arrangement common in financial services

Answer

An acceptable practice if the borrower signs an acknowledgment form