HUD Housing Counselor Exam Foreclosure || || || || ||
questions with verified answers || || ||
Default - ✔✔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.
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Delinquent - ✔✔At-least one full payment is past due (like if it is due the 1st, and it is now the
|| || || || || || || || || || || || || || || || || || || || ||
2nd)
Judicial Foreclosure - ✔✔Requires a court decision to execute the foreclosure. Typically a longer
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process than non-judicial foreclosures and more expensive for the lender.
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Late Payment - ✔✔A payment not received on the first day of the month.
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Non-Judicial Foreclosure - ✔✔Foreclosure process is handled through letters and public notices
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and does not require the use of courts.
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Redemption Period - ✔✔A specific time period that the homeowner can buy back or reclaim their
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property from whoever purchased it at the foreclosure sale.
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Key Players In Foreclosure Counseling - ✔✔Investor & Servicer (Investor is the original lender
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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 - ✔✔CFPB: Consumer
|| || || || || || || || || || || || ||
Financial Protection Bureau || ||
, The program helped homeowners avoid foreclosure, stabilize the housing market, and improve
|| || || || || || || || || || || ||
the economy - ✔✔Making Home Affordable
|| || || || ||
This program penalized five financial institutions for deceptive and misleading foreclosure
|| || || || || || || || || || ||
practices - ✔✔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?
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B. What type of mortgage do you have?
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C. What were your ratios when your loan was initially approved for purchase?
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D. Has any or all of your income been restored, indicating your serious delinquency might be
|| || || || || || || || || || || || || || || ||
curable? - ✔✔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 - ✔✔B. Subprime Lending
|| || || || || ||
What is Subprime Lending? - ✔✔Loan to borrowers with poor credit. Typically charge higher
|| || || || || || || || || || || || || ||
interest rates to insure against losses.|| || || || ||
What is a Subprime Loan? - ✔✔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.
|| || || || || || || || || || ||
questions with verified answers || || ||
Default - ✔✔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 - ✔✔At-least one full payment is past due (like if it is due the 1st, and it is now the
|| || || || || || || || || || || || || || || || || || || || ||
2nd)
Judicial Foreclosure - ✔✔Requires a court decision to execute the foreclosure. Typically a longer
|| || || || || || || || || || || || || ||
process than non-judicial foreclosures and more expensive for the lender.
|| || || || || || || || ||
Late Payment - ✔✔A payment not received on the first day of the month.
|| || || || || || || || || || || || ||
Non-Judicial Foreclosure - ✔✔Foreclosure process is handled through letters and public notices
|| || || || || || || || || || || ||
and does not require the use of courts.
|| || || || || || ||
Redemption Period - ✔✔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 - ✔✔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 - ✔✔CFPB: Consumer
|| || || || || || || || || || || || ||
Financial Protection Bureau || ||
, The program helped homeowners avoid foreclosure, stabilize the housing market, and improve
|| || || || || || || || || || || ||
the economy - ✔✔Making Home Affordable
|| || || || ||
This program penalized five financial institutions for deceptive and misleading foreclosure
|| || || || || || || || || || ||
practices - ✔✔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? - ✔✔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 - ✔✔B. Subprime Lending
|| || || || || ||
What is Subprime Lending? - ✔✔Loan to borrowers with poor credit. Typically charge higher
|| || || || || || || || || || || || || ||
interest rates to insure against losses.|| || || || ||
What is a Subprime Loan? - ✔✔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.
|| || || || || || || || || || ||
