Underwriting Assessment January 2012

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Jan 27, 2012

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Underwriting Assessment January 2012

Mortgage Insurance The GSE required standard MI Coverage on a 30-year, fixed rate loan with a 95% LTV is _______% coverage.

LTV/CLTV If a lender approves a borrower for a mortgage loan of $135,000 for the purchase of a house costing $145,000, what is the loan’s LTV ratio? (Round up to the nearest 1%)

General Which organizations(s) can pool loans for securitization?

Initial Documents On the application, the yes/no questions that must be answered by both the borrower and co-borrower are called:

On the application, a borrower’s child support payments are listed as a/an:

On the application, the borrower’s present mortgage that will be paid off is listed as a:

The RESPA form that approximates the charges for closing costs is called:

Employment/Income One method of calculating Net Rental Income is to multiply the gross rental income by _____%, and then subtract the total mortgage payment from the result.

If the calculation of Net Rental income results in a negative amount, it should be listed as:

If child support is considered stable income, how long must it continue beyond the closing date of the mortgage to be used as qualifying income?

4 years.

2 years.

3 years.

No time limit.

If a borrower is paid on a bi-monthly schedule, how many paychecks does the borrower receive during a calendar year?

If a borrower is employed by a relative or closely held family business, what other documentation, in addition to a VOE, is required?

Both a and c.

None of the above.

Before it is considered qualifying income, how many years must overtime pay, bonus or commissions be reflected in the borrower’s current employment history, under standard non-AUS underwriting guidelines?

Select the items that may be used to calculate gross monthly income for a borrower (not self-employed) under standard non-AUS underwriting guidelines: a. b. c. d. Both b and c. e. None of the above.

Handwritten pay stubs and/or W-2s are considered acceptable income documentation.

According to Fannie Mae, a borrower must have a history of receiving stable income from employment or other sources and a reasonable expectation that the income will continue in the foreseeable future. Fannie defines “foreseeable future as:

According to standard non-AUS guidelines, to substantiate employment and income for a self-employed borrower, the lender must obtain confirmation of the borrower’s personal and business earnings for the past _________ years?

Shannon, a single mother of two children, works a full-time job earning $5,000 a month. In addition, she receives $400 per month for each child. Shannon’s son, Tyler, is 10; her daughter, Madison, is 17. How much of Shannon’s total monthly income is considered qualifying income?

Tax Returns You determine a borrower is self-employed if he/she owns ___________% or more of a business.

From the list below, choose all of the business structures that can issue a Schedule K-1.

When all other risk factors are constant, the default rate for a self-employed borrower is significantly higher than that for a salaried borrower.

The following are forms of documentation that may be used to support the earnings for the self-employed borrower: Which document is used by a Corporation?

Which document may disclose the percentage of ownership of a partnership the borrower has?

Which document will disclose the dear-to-date earnings for the self-employed borrower?

Which document is used by a Sole Proprietor?

A letter from the corporate accountant, (on their letter-head; signed and dated) is acceptable documentation of your borrower’s percentage of ownership in the corporation.

Assets Reserves are liquid assets that are available to the borrower after closing.

A borrower’s reserves must be easily accessed liquid, or near liquid, financial assets. Which of the following items may not be considered as reserve funds?

Underwriting Assessment January 2012

Mortgage Insurance The GSE required standard MI Coverage on a 30-year, fixed rate loan with a 95% LTV is _______% coverage.

LTV/CLTV If a lender approves a borrower for a mortgage loan of $135,000 for the purchase of a house costing $145,000, what is the loan’s LTV ratio? (Round up to the nearest 1%)

General Which organizations(s) can pool loans for securitization?

Initial Documents On the application, the yes/no questions that must be answered by both the borrower and co-borrower are called:

On the application, a borrower’s child support payments are listed as a/an:

On the application, the borrower’s present mortgage that will be paid off is listed as a:

The RESPA form that approximates the charges for closing costs is called:

Employment/Income One method of calculating Net Rental Income is to multiply the gross rental income by _____%, and then subtract the total mortgage payment from the result.

If the calculation of Net Rental income results in a negative amount, it should be listed as:

If child support is considered stable income, how long must it continue beyond the closing date of the mortgage to be used as qualifying income? 4 years. 2 years. 3 years. No time limit.

If a borrower is paid on a bi-monthly schedule, how many paychecks does the borrower receive during a calendar year?

If a borrower is employed by a relative or closely held family business, what other documentation, in addition to a VOE, is required? Both a and c. None of the above.

Before it is considered qualifying income, how many years must overtime pay, bonus or commissions be reflected in the borrower’s current employment history, under standard non-AUS underwriting guidelines?

Select the items that may be used to calculate gross monthly income for a borrower (not self-employed) under standard non-AUS underwriting guidelines: a. b. c. d. Both b and c. e. None of the above.

Handwritten pay stubs and/or W-2s are considered acceptable income documentation.

According to Fannie Mae, a borrower must have a history of receiving stable income from employment or other sources and a reasonable expectation that the income will continue in the foreseeable future. Fannie defines “foreseeable future as:

According to standard non-AUS guidelines, to substantiate employment and income for a self-employed borrower, the lender must obtain confirmation of the borrower’s personal and business earnings for the past _________ years?

Shannon, a single mother of two children, works a full-time job earning $5,000 a month. In addition, she receives $400 per month for each child. Shannon’s son, Tyler, is 10; her daughter, Madison, is 17. How much of Shannon’s total monthly income is considered qualifying income?

Tax Returns You determine a borrower is self-employed if he/she owns ___________% or more of a business.

From the list below, choose all of the business structures that can issue a Schedule K-1.

When all other risk factors are constant, the default rate for a self-employed borrower is significantly higher than that for a salaried borrower.

The following are forms of documentation that may be used to support the earnings for the self-employed borrower: Which document is used by a Corporation?

Which document may disclose the percentage of ownership of a partnership the borrower has?

Which document will disclose the dear-to-date earnings for the self-employed borrower?

Which document is used by a Sole Proprietor?

A letter from the corporate accountant, (on their letter-head; signed and dated) is acceptable documentation of your borrower’s percentage of ownership in the corporation.

Assets Reserves are liquid assets that are available to the borrower after closing.

A borrower’s reserves must be easily accessed liquid, or near liquid, financial assets. Which of the following items may not be considered as reserve funds?

If child support is considered stable income, how long must it continue beyond the closing date of the mortgage to be used as qualifying income?

4 years.

2 years.

3 years.

No time limit.

If a borrower is employed by a relative or closely held family business, what other documentation, in addition to a VOE, is required?

Both a and c.

None of the above.