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HUD Housing Counselor Certification
Practice Questions and Correct Answers
the Latest Update and Recommended
Version
What is the maximum percent of area median income allowable for a household to qualify
for a Housing Choice Voucher?
✓ 50%
Which is the maximum recommended housing ratio for renting an apartment?
✓ 30%
Eligibility requirements for down-payment assistance programs include which factors?
✓ Income, home-buyer education, purchase price
The client is considering an FHA mortgage. What is the upfront mortgage insurance premium
(UFMIP) for an
FHA mortgage?
✓ 1.75%
If the client was denied a mortgage loan and the lender told him to come back after his
divorce had been final for three years, what is the best advice for the housing counselor to
provide to the client to report a violation to ECOA?
✓ Contact the Federal Trade Commission as the lender's action might violate the Equal
Credit Opportunity Act
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✓ Provide a loan estimate without factoring in the raise
If this client obtains a mortgage of $100,000, typically, how much should he expect to pay for
closing costs?
✓ $3000 to $4000
Is Application Fee an upfront cost of clients who are considering renting or buying a property?
✓ Renting
A client wants to customize his home with do-it-yourself projects, this is an indication the client is
best aligned with which housing option; Home-ownership or Renting?
✓ Home-ownership
The client's gross monthly income is $4167 and the monthly debts are $435. What is the
maximum mortgage payment (rounded to the nearest dollar) for which this client would
qualify using a standard conventional loan?
✓ $1,065
✓ NOTE: The maximum front-end ratio for a standard conventional loan is 28%, and the
back-end ratio is 36%. The front-end ratio is calculated as 28% of the client's monthly
income of $4,167, which is $1,167. The back-end ratio is calculated as 36% of the
✓ client's monthly income of $4,167 minus the client's monthly debt of $435, which equals
$1,065. Therefore, the maximum loan payment that the client qualifies for is the lower of
the two numbers, which is $1,065.
Which is the maximum debt-to-income ratio allowable for an FHA loan?
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Which is the maximum debt-to-income ratio allowable for an FHA Energy Efficiency Mortgage
loan?
✓ 45%
The client's gross monthly income is $4167 and the monthly debts are $435. With a monthly
mortgage payment of $950, which is the client's debt-to-income ratio (round to the nearest
whole percent)?
✓ 33%
The client's gross monthly income is $4167 and the monthly debts are $435. If the client seeks
an FHA Energy Efficient Mortgage (EEM) loan, what is the maximum housing payment for
which he can qualify (rounded to the nearest dollar)?
✓ $1,292
On which factor is a borrower's annual mortgage insurance premium (MIP) based?
✓ Current principal balance
✓
✓ NOTE: The annual mortgage insurance premium (MIP) is based on the unpaid principal
balance of the loan. The loan-to-value ratio is used to determine when private mortgage
insurance (PMI) can be dropped from the loan. Credit scores do not affect MIP but might
affect PMI.
Which is the upfront mortgage insurance premium (UFMIP) if the client purchases a home with
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