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HUD Practice test/11 Questions with Complete Solutions
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HUD Practice test/11 Questions with Complete Solutions
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HUD Practice test/11 Questions withComplete Solutions
1) A client would like to purchase a house within one year. The client is
motivated to increase household income as a way to save for a down
payment and qualify for a loan. Which is the best solution for the client to
reach this goal? - -Find a second job
-2) Six months ago a client left a job as a reporter to start a business in the
retail industry. To prepare to buy a house, the client closed credit card
accounts and has been using savings to pay down credit card debt and
collections. The client has not been able to save much for a down payment
with all the debt payments but knows about an affordable homeownership
program that only requires a 1% down payment with an FHA Loan. What
might result from the client closing the credit card accounts? - -It decreases
credit utilization, causing a positive impact on the credit score
-3. Which family is most likely to qualify for the Earned Income Tax Credit
(EITC) - -An individual employed part time in a minimum wage job
-4. A client shopping for a mortgage loan present a housing counselor with
an offer from a local mortgage lender. The interest rate on the offer is 7.5%
for a 30 year fixed rate mortgage with a 20% down payment required. The
counselor reviews the client file and determines the client's credit score is
725 and the client's total debt to income ratio is 20%. The client asks the
housing counselor if the offer is a case of illegal predatory lending. How
should the housing counselor respond? - -I am unable to determine whether
the loan is predatory, but I suggest you shop around with other lending
sources.
-5. Which does a servicer do in the non-judicial foreclosure? - -Issues a
Notice of Default (NOD) to the borrower
-6 Under which circumstance must a servicer refrain from the foreclosure
process - -The client has a pending loan modification application
-7. What should a counselor and borrower focus on when developing an
emergency budget? - -Increasing income and decreasing expenses
-8. A client who is not behind on the mortgage was recently informed of a
reduction of income for two months by the client's employer. The Client has
an FHA loan and would like to take action as soon as possible to avoid a
mortgage delinquency. Which FHA Loss Mitigation option is likely best for
this client? - -Informal/formal forbearance
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