HUD Housing Counselor Exam: Foreclosure Question and answers 100% correct 2023
Default - correct answer Non payment of a mortgage debt. Typically considered this when a payment has not been made after 60-90 days. For FHA loans, it is only 30 days.
Delinquent - correct answer At-least on...
HUD Housing Counselor Exam: Foreclosure Question and answers 100% correct 2023
Default - correct answer Non payment of a mortgage debt. Typically considered this when a payment has not been made after 60-90 days. For FHA loans, it is only 30 days.
Delinquent - correct answer At-least one full payment is past due (like if it is due the 1st, and it is now the 2nd)
Judicial Foreclosure - correct answer Requires a court decision to execute the foreclosure. Typically a longer process than non-judicial foreclosures and more expensive for the lender.
Late Payment - correct answer A payment not received on the first day of the month.
Non-Judicial Foreclosure - correct answer Foreclosure process is handled through letters and public notices and does not require the use of courts.
Redemption Period - correct answer A specific time period that the homeowner can buy back or reclaim their property from whoever purchased it at the foreclosure sale.
Key Players In Foreclosure Counseling - correct answer Investor & Servicer (Investor is the original lender who has kept ownership of the loan or another entity that purchased the loan from the original lender. They also receive the proceeds from the monthly principal and interest payments that the homeowner makes). Servicer (Financial companies that negotiate mortgage delinquency resolutions with homeowners).
This agency abolished the practice of Dual Tracking by servicers - correct answer CFPB: Consumer Financial Protection Bureau
The program helped homeowners avoid foreclosure, stabilize the housing market, and improve the economy - correct answer Making Home Affordable
This program penalized five financial institutions for deceptive and misleading foreclosure practices - correct answer National Mortgage Settlement
What of the following is not one of the initial steps a housing counselor will ask the client
during the first loss mitigation appointment? A. What is the reason for your delinquency/ what is your hardship?
B. What type of mortgage do you have? C. What were your ratios when your loan was initially approved for purchase?
D. Has any or all of your income been restored, indicating your serious delinquency might be curable? - correct answer C. What were your ratios when your loan was initially approved for purchase?
The terms Ability to Repay and Qualified Mortgage were defined in regulations implemented by the Consumer Finance Protection Bureau because of what industry wide problem?
A. Loan Modification Scams
B. Subprime Lending
C. Blockbusting
D. Jumbo Lending - correct answer B. Subprime Lending
What is Subprime Lending? - correct answer Loan to borrowers with poor credit. Typically charge higher interest rates to insure against losses.
What is a Subprime Loan? - correct answer A type of mortgage with less stringent lending and underwriting terms and conditions, usually offered to borrowers with limited credit history and low income. Due to the increased credit risk, subprime loans carry higher interest rates.
What is blockbusting? - correct answer To convince or attempt to convince a person to sell or rent a house/apartment because of the entry or prospective entry into the neighborhood or a person(s) of a particular race, color, religion, sex, familiar status, national origin, or with a disability.
Which option would be most likely to require that the mortgage is current for eligibility?
A. Unemployment forbearance
B. Loan Modification
C. Principal Reduction
D. Refinance - correct answer D. Refinance
What is The Consumer Finance Protection Bureau (CFPB)? - correct answer It regulates the offering and provision of consumer financial products and provision of consumer financial products or services under the federal consumer financial laws and educates and empowers consumers to make better informed financial decisions.
Since receiving a loan modification under the Making Home Affordable Program several
years ago, a borrower has been current on his mortgage until he recently suffered a severe reduction in income. A housing counselor advised the client to seek assistance from the servicer to prevent foreclosure. The servicer claimed it could not evaluate the borrower for further relief due to the prior modification. Is this servicer is compliance?
A. No
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