HUD Housing Counselor Certification Exam with || || || || ||
accurate detailed answers
|| || ||
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
|| || || || || || ||
A question from a lender on the client's Medical History would be inappropriate or appropriate? -
|| || || || || || || || || || || || || || || ||
✔✔Inappropriate
Who is responsible for educating home-buyers about their rights? - ✔✔Housing Counselor
|| || || || || || || || || || ||
In order to minimize the impact on the client's credit score, what is the maximum time frame
|| || || || || || || || || || || || || || || || ||
within which the client should apply for pre-approval from multiple lenders? - ✔✔A 30-day
|| || || || || || || || || || || || || ||
period
,What are the responsibilities of a home inspector? - ✔✔Examine mechanical systems, Evaluate
|| || || || || || || || || || || || ||
the condition of a home, Identify items to be repaired or replaced
|| || || || || || || || || || ||
Which is the best reason that a housing counselor would suggest that a client speak to three to five
|| || || || || || || || || || || || || || || || || ||
different lenders? - ✔✔To compare loan estimates
|| || || || || || ||
Which is the best advice that a housing counselor can give the client to protect against identity
|| || || || || || || || || || || || || || || || ||
theft? - ✔✔Review credit report at least once per year
|| || || || || || || || ||
The client tells the lender that he is expecting a raise soon. Should the Lender provide a Loan
|| || || || || || || || || || || || || || || || || ||
Estimate (LE) with, or without factoring the raise? - ✔✔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? - ✔✔43%
|| || || || || || || || || || || ||
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
|| || || || || || || || || || || || || || ||
an FHA loan amount of $116,000? - ✔✔$2,030
|| || || || || || ||
The client only tracks bill payments. Which should the housing counselor recommend to help the
|| || || || || || || || || || || || || || ||
client begin ||
planning for a home purchase? || || || ||
A- Continue to track bill payments only
|| || || || || ||
B- Track income only
|| || ||
C- Track all income and expenses
|| || || || ||
, D- Track savings deposits and expenses - ✔✔C- Track all income and expenses
|| || || || || || || || || || || ||
How should a client apply for the Housing Choice Voucher Program? - ✔✔Contact the local
|| || || || || || || || || || || || || || ||
Public Housing Authority || ||
Which website provides information on programs to assist home-buyers with down payment
|| || || || || || || || || || || ||
assistance? - ✔✔HUD.gov || ||
Based on the client's income of $56,400 per year of, savings of 12,000 toward a down payment,
|| || || || || || || || || || || || || || || || ||
and credit score of 700, which mortgage option is likely best for her; Conventional loan, FHA
|| || || || || || || || || || || || || || || ||
loan, USDA Rural Development loan, or Subprime loan? - ✔✔Conventional loan
|| || || || || || || || || ||
This client is denied a loan to purchase a home because she has not lived in the country for at least
|| || || || || || || || || || || || || || || || || || || ||
ten years. Which Act is this adverse action violating, and where should the client report this
|| || || || || || || || || || || || || || || || ||
action to? - ✔✔Report the action to the Federal Trade Commission, it is a violation of the Equal
|| || || || || || || || || || || || || || || || || ||
Credit Opportunity Act || ||
If the client submits a loan application, which document should she receive within three business
|| || || || || || || || || || || || || || ||
days? - ✔✔Loan Estimate || || ||
What is a pre-approval from a lender? - ✔✔When the lender commits to lend a fixed amount
|| || || || || || || || || || || || || || || || ||
based on a review of the client's application.|| || || || || || ||
A client has been a paralegal for five years and earns $56,400 per year. She has been working
|| || || || || || || || || || || || || || || || || ||
part-time at an ice cream parlor for the past few summers to save for her first home. Now that she
|| || || || || || || || || || || || || || || || || || || ||
has saved $12,000 toward a down payment, she no longer needs to work a second job. In the next
|| || || || || || || || || || || || || || || || || || ||
three months, the client would like to buy a single-family home near a good school for less than
|| || || || || || || || || || || || || || || || || ||
$150,000. ||
Does this client meet a lender's expectation for continued employment? - ✔✔Yes, because the
|| || || || || || || || || || || || || ||
client has been at her job over two years || || || || || || || ||
accurate detailed answers
|| || ||
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
|| || || || || || ||
A question from a lender on the client's Medical History would be inappropriate or appropriate? -
|| || || || || || || || || || || || || || || ||
✔✔Inappropriate
Who is responsible for educating home-buyers about their rights? - ✔✔Housing Counselor
|| || || || || || || || || || ||
In order to minimize the impact on the client's credit score, what is the maximum time frame
|| || || || || || || || || || || || || || || || ||
within which the client should apply for pre-approval from multiple lenders? - ✔✔A 30-day
|| || || || || || || || || || || || || ||
period
,What are the responsibilities of a home inspector? - ✔✔Examine mechanical systems, Evaluate
|| || || || || || || || || || || || ||
the condition of a home, Identify items to be repaired or replaced
|| || || || || || || || || || ||
Which is the best reason that a housing counselor would suggest that a client speak to three to five
|| || || || || || || || || || || || || || || || || ||
different lenders? - ✔✔To compare loan estimates
|| || || || || || ||
Which is the best advice that a housing counselor can give the client to protect against identity
|| || || || || || || || || || || || || || || || ||
theft? - ✔✔Review credit report at least once per year
|| || || || || || || || ||
The client tells the lender that he is expecting a raise soon. Should the Lender provide a Loan
|| || || || || || || || || || || || || || || || || ||
Estimate (LE) with, or without factoring the raise? - ✔✔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? - ✔✔43%
|| || || || || || || || || || || ||
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
|| || || || || || || || || || || || || || ||
an FHA loan amount of $116,000? - ✔✔$2,030
|| || || || || || ||
The client only tracks bill payments. Which should the housing counselor recommend to help the
|| || || || || || || || || || || || || || ||
client begin ||
planning for a home purchase? || || || ||
A- Continue to track bill payments only
|| || || || || ||
B- Track income only
|| || ||
C- Track all income and expenses
|| || || || ||
, D- Track savings deposits and expenses - ✔✔C- Track all income and expenses
|| || || || || || || || || || || ||
How should a client apply for the Housing Choice Voucher Program? - ✔✔Contact the local
|| || || || || || || || || || || || || || ||
Public Housing Authority || ||
Which website provides information on programs to assist home-buyers with down payment
|| || || || || || || || || || || ||
assistance? - ✔✔HUD.gov || ||
Based on the client's income of $56,400 per year of, savings of 12,000 toward a down payment,
|| || || || || || || || || || || || || || || || ||
and credit score of 700, which mortgage option is likely best for her; Conventional loan, FHA
|| || || || || || || || || || || || || || || ||
loan, USDA Rural Development loan, or Subprime loan? - ✔✔Conventional loan
|| || || || || || || || || ||
This client is denied a loan to purchase a home because she has not lived in the country for at least
|| || || || || || || || || || || || || || || || || || || ||
ten years. Which Act is this adverse action violating, and where should the client report this
|| || || || || || || || || || || || || || || || ||
action to? - ✔✔Report the action to the Federal Trade Commission, it is a violation of the Equal
|| || || || || || || || || || || || || || || || || ||
Credit Opportunity Act || ||
If the client submits a loan application, which document should she receive within three business
|| || || || || || || || || || || || || || ||
days? - ✔✔Loan Estimate || || ||
What is a pre-approval from a lender? - ✔✔When the lender commits to lend a fixed amount
|| || || || || || || || || || || || || || || || ||
based on a review of the client's application.|| || || || || || ||
A client has been a paralegal for five years and earns $56,400 per year. She has been working
|| || || || || || || || || || || || || || || || || ||
part-time at an ice cream parlor for the past few summers to save for her first home. Now that she
|| || || || || || || || || || || || || || || || || || || ||
has saved $12,000 toward a down payment, she no longer needs to work a second job. In the next
|| || || || || || || || || || || || || || || || || || ||
three months, the client would like to buy a single-family home near a good school for less than
|| || || || || || || || || || || || || || || || || ||
$150,000. ||
Does this client meet a lender's expectation for continued employment? - ✔✔Yes, because the
|| || || || || || || || || || || || || ||
client has been at her job over two years || || || || || || || ||
