HUD PRACTICE EXAM 2026 EXAMINATION
TEST COMPLETE QUESTIONS AND ANSWERS
GRADED A+
◉ A client does not receive a written monthly statement from the
credit card company. Which credit law could this omission violate?
Answer: Fair Credit Billing Act
◉ In which situation would a client's responsibilities, recurring
costs, and upfront costs be evaluated? Answer: 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? Answer: Answer is 728.
40x15=_x52_/12=_.28=728
◉ Front end ratio for Conventional Loan Answer: 28%
◉ Back End ratio Answer: Only calculate if you have expenses in the
problem. Only include debts that appear on Credit report.
,◉ If they say Debt to income ratio : Answer: they are looking for
Back End Ratio
◉ If it says housing ratio : Answer: Calculate front end
◉ If they say "What is the highest monthly mortgage payment" and
they give you expenses: Answer: You do both front & back end &
choose the lowest total
◉ 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? Answer:
2300-450=_X.32=592
◉ 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)? Answer: ANSWER IS 30%
1250+88/4460
◉ How to solve for back end ratio Answer: back end ratio = total
monthly debt expenses/ gross monthly income
◉ A client earns a salary of $45,000 at a job held for three years. The
client has credit card bills, student loans, and a car loan totaling
, $500 per month. The client has already saved $3,500 for a down
payment and is using an FHA Energy Efficient Mortgage (EEM).If the
client wants to make the minimum down payment for a home priced
at $150,000, how much more does the client need to save?
$1,750
$2,250
$4,500
$5,250 Answer: Down payment for EEM is 3.5% so you take 150,000
x .035=5250-3500=$1750
◉ EEM Answer: Energy Efficient Mortgage
A type of FHA loan
front end: 33%
back end max: 45%
◉ Which type of assistance administered by a public housing
authority allows for location flexibility?
Project-based vouchers
USDA
Tenant-based vouchers
FHA Answer: Tenant-based vouchers
TEST COMPLETE QUESTIONS AND ANSWERS
GRADED A+
◉ A client does not receive a written monthly statement from the
credit card company. Which credit law could this omission violate?
Answer: Fair Credit Billing Act
◉ In which situation would a client's responsibilities, recurring
costs, and upfront costs be evaluated? Answer: 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? Answer: Answer is 728.
40x15=_x52_/12=_.28=728
◉ Front end ratio for Conventional Loan Answer: 28%
◉ Back End ratio Answer: Only calculate if you have expenses in the
problem. Only include debts that appear on Credit report.
,◉ If they say Debt to income ratio : Answer: they are looking for
Back End Ratio
◉ If it says housing ratio : Answer: Calculate front end
◉ If they say "What is the highest monthly mortgage payment" and
they give you expenses: Answer: You do both front & back end &
choose the lowest total
◉ 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? Answer:
2300-450=_X.32=592
◉ 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)? Answer: ANSWER IS 30%
1250+88/4460
◉ How to solve for back end ratio Answer: back end ratio = total
monthly debt expenses/ gross monthly income
◉ A client earns a salary of $45,000 at a job held for three years. The
client has credit card bills, student loans, and a car loan totaling
, $500 per month. The client has already saved $3,500 for a down
payment and is using an FHA Energy Efficient Mortgage (EEM).If the
client wants to make the minimum down payment for a home priced
at $150,000, how much more does the client need to save?
$1,750
$2,250
$4,500
$5,250 Answer: Down payment for EEM is 3.5% so you take 150,000
x .035=5250-3500=$1750
◉ EEM Answer: Energy Efficient Mortgage
A type of FHA loan
front end: 33%
back end max: 45%
◉ Which type of assistance administered by a public housing
authority allows for location flexibility?
Project-based vouchers
USDA
Tenant-based vouchers
FHA Answer: Tenant-based vouchers
