Hud Certification Exam: 1. Financial Management100% SOLUTIONS 100% PASS

Hud Certification Exam: 1. Financial Management100% SOLUTIONS 100% PASS Items to Include for Tracking Income - ANSWER Regular Salary Temporary Jobs Unemployment Compensation Public Assistance *If pay varies, average it over 12 months Items NOT to include for tracking income - ANSWER Pretax Payroll Deductions Credit Score Documents to Use for Budgeting: Income - ANSWER Paychecks/Payslips If self employed, Income/Expenses sheet Additional Income Checks/Cash Government Issued Benefits Letters Items to Include for Tracking Expenses - ANSWER All bills All fixed monthly expenses All cash expenses Seasonal/Aual Expenses: car registration, insurance, gifts, tax fees, vacations, holidays, etc Documents to Use: Tracking Expenses - ANSWER Utility/insurance/other bills Bank Statements Credit Card Statements Records about car registration, school supplies, etc. 5 Parts of a Credit Report - ANSWER Personal Information Account/Trade Line Information Public Records Inquiries Consumer Rights Credit Factors - ANSWER Payment History Capacity Used Length of Credit History Type of Credit Used New Credit How does Payment History affect your credit? - ANSWER Positive: Timely payment history demonstrates reliability. Negative: Late payment history demonstrates higher risk of future delinquency. Negative Examples: Lien, judgment, collection account, charge-of account, repossession, bankruptcy How does Capacity Used affect your credit? - ANSWER Positive: Low credit utilization demonstrates good financial management. Negative: High credit card balances demonstrate poor financial management (i.e., client needs more access to credit). Negative Examples: Maxed out credit cards How does Length of Credit History affect your credit? - ANSWER Positive: Longer credit history provides more information for lenders, which means lower risk. Negative: Shorter credit history provides little to no information for lenders, which means higher risk. Negative Examples: No credit history How do Types of Credit Used affect credit? - ANSWER Positive: Different types of credit show variety. Variety shows lenders that consumers can manage different types of credit. Negative: Fewer types of credit show limited profile information to lenders, which means a higher risk. Negative Examples: Only having a student loan or only having credit cards