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HUD Practice Exam With Complete Solutions Latest Update
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HUD Practice Exam With Complete Solutions Latest Update
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HUD Practice ExamWhich document is most important when working with a client to develop an initial budget as part of a Client Action
Plan? - correct answers List of Assets
Retirement plan statement
Pay stub X
Current lease
A client would like purchase a home 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? - correct
answers
A credit report may contain which information? - correct answers Income history
Criminal record
# of accounts in collection status
A history of payments on an elctric bill
A credit report contains inaccurate information. Which action item should the counselor include in the Client Action
Plan? - correct answers FIle a dispute with the appropaite credit reporting agency
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? - correct answers
Which action would a client take to improve a credit score? - correct answers
A client does not receive a written monthly statement from the credit card company. Which credit law could this
omission violate? - correct answers FCBA
, A client shopping for a mortgage loan presents 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? - correct answers I am unable to determine whether the loan is predatory but i suggest you shop around with
other ledning sources
Which action should a counselor recommend a client take first after discovering identity theft? - correct answers File an
identity theft report
In which situation would a client's responsibilities, recurring costs, and upfront costs be evaluated? - correct answers
When weighing housing options
A client works 40 hours a week making $15 an hour. What is the highest monthly mortgage the client can afford based
on income if the client secures a conventional loan? - correct answers Front End Ratio Formula
Conventional = <28%
Which type of government insured loan was created for financing homes in rural areas? - correct answers USDA
A client keeps having budget problems due to unexpected expenses. Which financial tool would best assist this client to
prepare for unexpected expenses and avoid increasing credit usage? - correct answers Emergency Fund
A client has a monthly household income of $2,300, monthly debt payments of $450, and an optimal monthly housing
ratio of 32%. What is the client's optimal monthly housing payment? - correct answers Front End Ratio Formula
What is the back-end ratio for a client with a monthly housing expense of $1,250, a monthly total of $88 in other
consumer debt payments, and a gross household income of $4,460 per month (rounded to the nearest whole percent)?
- correct answers Debt to income ratio or back end ratio
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