NMLS Quiz: Apply Underwriting Analysis

What this quiz covers

This quiz focuses on Apply Underwriting Analysis, giving you a quick way to practice the rules, question types, and explanations that matter most for NMLS.

How to use this quiz

Try each quiz question before looking at the correct answer. Use the explanations to review missed ideas, then come back to similar questions until the pattern feels familiar.

Question 1

1. Zero payment since the loan is deferred and no current payment obligation exists
2. One percent of the outstanding loan balance as an estimated monthly payment amount (correct answer)
3. The payment amount that will be required when the deferment period ends
4. The minimum payment that was required before the deferment period began

Question 2

1. Borrower's written explanation of the loan terms and current balance with payment history
2. Direct verification from the creditor or current loan statement showing balance and payment terms (correct answer)
3. Bank statements showing recent payments made to the creditor for the past three months
4. Credit monitoring report from an alternative reporting agency that tracks non-traditional credit accounts

Question 3

1. Borrower's written statement of payment amounts plus bank statements showing deposits for three months
2. Court order or agreement plus evidence of consistent receipt for at least twelve months (correct answer)
3. Tax returns showing the income plus verification that payments are current and up-to-date
4. Legal documentation only, since court orders guarantee payment and no further verification is needed

Question 4

1. Gift letter from donor only, since the relationship and intent are clearly stated in writing
2. Gift letter, donor's bank statements, and evidence of funds transfer to borrower's account (correct answer)
3. Borrower's bank statement showing the deposit plus written explanation of the gift source
4. Donor's tax returns for two years plus verification of the donor's employment and income

Question 5

1. Borrower's medical records plus physician's statement regarding the permanence of the disability condition
2. Award letter from disability provider plus evidence of payment receipt with continuance verification (correct answer)
3. Tax returns showing disability income plus borrower's explanation of the disability and benefit duration
4. Insurance company policy documents plus borrower's statement of monthly benefit amounts received

Question 6

1. Use the most recent bonus amount since it reflects the borrower's current compensation level
2. Average the bonus income over two years and use only if it shows consistent patterns (correct answer)
3. Exclude bonus income entirely since it is not guaranteed and represents irregular compensation
4. Use the highest bonus amount received in the last two years as the expected annual amount

Question 7

1. Borrower-provided account statement printout from the retirement plan's website portal
2. Direct verification from the plan administrator or custodian with official letterhead and signature (correct answer)
3. Copy of the most recent quarterly statement mailed to the borrower by the plan administrator
4. Borrower's tax return showing retirement account distributions from the previous tax year only

Question 8

1. Sporadic overtime with significant variation between pay periods and no consistent pattern established
2. Consistent overtime for two years with employer confirmation that overtime will continue to be available (correct answer)
3. Recent increase in overtime due to temporary project work that is scheduled to end next month
4. Overtime income that represents more than fifty percent of the borrower's total gross monthly income

Question 9

1. Use only the highest-paying position since other part-time work may not continue long-term
2. Verify each position separately with two years of history and combine if all show stability (correct answer)
3. Average all part-time income together regardless of employment history or position stability
4. Require the borrower to obtain full-time employment before considering the loan application further

Question 10

1. Borrower's Social Security card and estimate of monthly benefits from the Social Security website
2. Award letter from Social Security Administration plus evidence of direct deposit or benefit receipt (correct answer)
3. Tax return showing Social Security income plus borrower's statement of current benefit amount
4. Bank statements showing direct deposits labeled as Social Security benefits for the past year

Question 11

1. Diversified mutual funds with steady five-year growth patterns and professional management
2. Heavy concentration in single volatile stock with significant recent value fluctuation (correct answer)
3. Mixed bonds and stocks managed by registered investment advisor with balanced allocation
4. Index funds tracking major market indices with standard market risk and broad diversification

Question 12

1. Previous employer's human resources confirmation letter plus borrower's written estimate of monthly pension payments
2. Pension plan administrator's award letter plus evidence of monthly payment receipt for verification (correct answer)
3. Tax returns showing pension income plus Social Security Administration verification letter of retirement benefits
4. Bank statements showing pension deposits plus borrower's pension plan summary document from former employer

Question 13

1. Co-borrower with stable two-year employment history and documented income that will continue post-closing (correct answer)
2. Co-borrower who is retiring within six months but has sufficient pension income to replace salary
3. Co-borrower who recently started new employment but has strong industry experience and references
4. Co-borrower with seasonal employment that varies significantly based on industry demand and weather

Question 14

1. Total liquid assets minus down payment and closing costs must equal two months of housing payments exactly
2. Total assets including retirement accounts must equal six months of total monthly debt payment obligations
3. Liquid assets after closing must equal the greater of two months' payments or specific program requirements (correct answer)
4. Available credit lines and cash assets combined must total at least ten percent of loan amount

Question 15

1. Property tax bill for a different property
2. Credit card statement showing minimum payment due
3. Text message confirming funds belong to the borrower
4. Bank statements showing account holder name and full account number (correct answer)

Question 16

1. DTI is replaced by loan-to-value for investment properties
2. DTI can be lowered by excluding student loans automatically
3. DTI is based only on housing payment, not other debts
4. Accurate DTI requires all monthly liabilities from credit report and disclosures (correct answer)

Question 17

1. Two months bank statements and current brokerage statement (correct answer)
2. Utility bills showing on-time payment history
3. Credit card statement listing available credit limits
4. Unverified screenshot of investment account balance

Question 18

1. Reliability of rental income considering vacancy and lease terms (correct answer)
2. Borrower's preference for escrow waiver at closing
3. Number of bedrooms compared to nearby listings
4. Borrower's length of time living at current address

Question 19

1. One current pay stub without year-to-date earnings
2. Two years W-2s and a pay stub showing YTD commissions (correct answer)
3. A personal budget listing projected commission amounts
4. A credit card statement showing business-related purchases

Question 20

1. Verified reserves after closing to cover vacancies and repairs (correct answer)
2. Borrower's preferred closing date listed on the contract
3. Property color and exterior condition description
4. Borrower's employer size compared to local market