The MLO is resolving Secondary Market GSEs during a quality-control sample. Which action best fits the rule?
Correct Answer
C) Apply the Fannie Mae or Freddie Mac selling-guide requirement
Why this is correct: When a loan is intended for sale to a Government-Sponsored Enterprise (GSE) like Fannie Mae or Freddie Mac, it must meet that specific GSE's eligibility and underwriting requirements as detailed in its selling guide. During quality control, the reviewer must apply the correct selling-guide rules to the specific loan file to ensure it conforms and is eligible for purchase. This is the core rule for GSE loans. Why the other choices are wrong: Apply a different loan-program rule without checking the file facts is incorrect because different programs (e.g., FHA vs. GSE) have different rules; applying the wrong one invalidates the review. Use prior licensing approval as a substitute is wrong because an MLO's license has no bearing on whether a specific loan meets secondary market guidelines. Use the same treatment for all mortgage products without comparing program requirements is incorrect because product requirements differ; a one-size-fits-all approach fails quality control. Exam tip: In secondary market questions, "selling guide" is a key phrase. The correct GSE guide is the rulebook for that loan.
Why This Is the Correct Answer
The correct response is "Apply the Fannie Mae or Freddie Mac selling-guide requirement" because GSE purchases depend on conforming eligibility, selling-guide standards, and loan-limit rules.
Why the Other Options Are Wrong
Option A: Apply a different loan-program rule without checking the file facts.
Apply a different loan-program rule without checking the file facts. is not correct because it does not apply the rule tested by this file scenario.
Option B: Use prior licensing approval as a substitute for the current Secondary Market GSEs requirement.
This distractor shifts the issue to a different trigger, product, or timing rule instead of applying the rule tested in the stem.
Option D: Use the same treatment for all mortgage products without comparing program requirements.
Use the same treatment for all mortgage products without comparing program requirements. is not correct because it does not apply the rule tested by this file scenario.
Memory Technique
GSE secondary-market requirements: identify the rule being tested, then choose the action that documents or applies that rule before the file moves forward.
Exam Tip
Match the file facts to GSE secondary-market requirements; do not choose an exception or shortcut that skips the required rule.
Common Mistakes to Avoid
- -Choosing an internal exception instead of the governing rule
- -Treating preliminary or informal facts as a substitute for required documentation
- -Answering from a familiar but unrelated mortgage topic
More Mortgage Knowledge Questions
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