For Fannie Mae loan pricing, a sole borrower has three valid credit scores: 704, 688 and 731. What is the representative credit score?
Correct Answer
D) 704, the middle of the three scores
D. The representative score is 704. Sort the valid scores: 688, 704, 731. For one borrower with three scores, select the middle score; that is also the loan’s representative score. Scope and exceptions: This question concerns Fannie Mae pricing, not every credit-score use. With multiple scored borrowers, first determine each borrower’s applicable score, then use the lowest for the representative score. Some manual-underwriting eligibility tests use a separate average-median method. Source: Representative Credit Score, steps 2–3; Average Median Credit Score — https://selling-guide.fanniemae.com/sel/b3-5.1-02/determining-credit-score-mortgage-loan
Why This Is the Correct Answer
D. The representative score is 704. Sort the valid scores: 688, 704, 731. For one borrower with three scores, select the middle score; that is also the loan’s representative score. Scope and exceptions: This question concerns Fannie Mae pricing, not every credit-score use. With multiple scored borrowers, first determine each borrower’s applicable score, then use the lowest for the representative score. Some manual-underwriting eligibility tests use a separate average-median method.
Why the Other Options Are Wrong
Option A: 731, the highest of the three scores
It selects the highest rather than the middle score.
Option B: 708, the three-score average rounded to a whole number
Averaging all three is not the representative-score method.
Option C: 688, the lowest of the three scores
The lower-of-two rule does not apply to three valid scores.
Exam Tip
For three scores, sort and select the middle—do not average.
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