Client Relations and Advisory Flashcards
7 cards from real CMC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Client Relations and Advisory flashcards as text
A borrower asks the CMC to recommend a rate lock period. The property closing is scheduled in 35 days. What lock term is most appropriate?
Answer: 45-day lock
A 45-day lock covers the 35-day closing timeline with a 10-day buffer for potential delays, avoiding the higher cost of a 60-day lock.
Which action by a CMC would violate RESPA Section 8?
Answer: Accepting a fee from a title company in exchange for steering business to them
RESPA Section 8 prohibits receiving anything of value in exchange for referrals of settlement service business.
A client's income has two components: $4,000/month salary and $1,200/month freelance income for 14 months. How should the CMC handle the freelance income?
Answer: Include a reduced amount based on a 2-year average if documented
Most guidelines require a two-year self-employment history; with only 14 months documented, a lender may use an averaged amount if a strong upward trend and documentation exist.
What is the primary purpose of the Closing Disclosure under TRID?
Answer: To give borrowers final loan terms and costs at least three business days before consummation
The Closing Disclosure provides final, binding loan terms and itemized closing costs, and must be delivered at least three business days before the loan closes.
A client with strong credit is choosing between a 15-year and 30-year mortgage. The CMC should highlight that the 15-year option typically offers:
Answer: Higher monthly payments but lower total interest and a lower interest rate
15-year mortgages carry lower rates than 30-year loans and dramatically reduce lifetime interest paid, though monthly payments are higher.
During a consultation, a client expresses frustration that their application was denied. An effective CMC response is to:
Answer: Acknowledge the frustration, explain the specific reasons, and outline a remediation plan
Empathetic communication paired with a concrete action plan rebuilds client confidence and creates a pathway toward future approval.
Which factor most directly affects a borrower's loan-to-value ratio?
Answer: Down payment amount
LTV is calculated as loan amount divided by appraised value; a larger down payment reduces the loan amount and therefore lowers the LTV.