Practice Test Geeks(CMC) Certified Mortgage Consultant Practice Test
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Client Relations and Financial 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 Financial Advisory flashcards as text

  1. A client is self-employed and has large write-offs that reduce their taxable income. How should a mortgage consultant typically calculate qualifying income?

    Answer: Average the last two years of net income from Schedule C after adding back depreciation

    For self-employed borrowers, lenders typically average two years of net income from tax returns and add back non-cash deductions like depreciation.

  2. A client is relocating and needs to close in 21 days. Which loan program is LEAST likely to meet this timeline?

    Answer: USDA Rural Development loan

    USDA loans require USDA agency approval in addition to lender underwriting, which often extends the timeline well beyond 21 days.

  3. Under the Fair Housing Act, which action by a mortgage consultant constitutes illegal steering?

    Answer: Directing minority clients toward higher-cost loan products based on race

    Steering protected-class members toward less favorable loan products based on race violates the Fair Housing Act's anti-discrimination provisions.

  4. A client wants to use a cash gift from a family member for a down payment. What documentation is typically required by lenders?

    Answer: A signed gift letter, evidence of donor's withdrawal, and evidence of borrower's deposit

    Lenders require a gift letter confirming no repayment is expected, plus a paper trail showing the donor's withdrawal and the borrower's receipt of funds.

  5. Which factor is most important when comparing two loan offers with the same interest rate but different fees?

    Answer: The Annual Percentage Rate (APR)

    APR incorporates both the interest rate and fees into a single figure, making it the best tool for comparing the true cost of two loans with the same stated rate.

  6. A consultant recommends a loan product that earns them a higher commission but is not in the client's best interest. This violates which core principle?

    Answer: Integrity and duty to client

    Recommending products for personal financial gain rather than client benefit violates the integrity and client-first principles central to professional mortgage consulting ethics.

  7. What is the primary purpose of the three-day waiting period before closing on most mortgage transactions under TRID?

    Answer: To give the borrower time to review the Closing Disclosure and compare it against the Loan Estimate

    TRID's mandatory three-business-day waiting period after the Closing Disclosure is delivered ensures borrowers have adequate time to review final loan costs.