HUD HOUSING COUNSELOR CERTIFICATION FINAL EXAM
QUESTIONS AND ANSWERS FIRM A+
✔✔The client finally leaves her home and moves to a rental and is concerned about
being displaced if the apartment becomes unlivable. Which is the best advice the
counselor can provide?
A- Have a designated emergency credit card
B- Purchase a renters insurance policy that only covers contents and personal liability
C- Plan to apply rent payments to hotel expenses
D- Purchase a renters insurance policy that includes loss-of-use coverage - ✔✔D-
Purchase a renters insurance policy that includes loss-of-use coverage
✔✔Which is the best advice a housing counselor can give this client who is concerned
about high heating bills and wants information on how to plan for home maintenance?
A- Create a list of each key system in her home with target dates for maintenance and
replacement
B- Use emergency funds to deal with system maintenance and replacement
C- Purchase a home warranty annually to ensure her home is properly protected from
maintenance costs
D- Do maintenance and replacement only when they lead to significant financial tax
benefits - ✔✔A- Create a list of each key system in her home with target dates for
maintenance and replacement
✔✔Which is the best initial advice a housing counselor can provide if the client needs to
replace old windows in her home?
A- Explore an FHA Energy Efficiency loan
B- Advise the client to replace one window at a time so the project is more affordable
C- Visit ready.gov to learn about home energy improvement projects
D- Hire a home energy efficiency inspector - ✔✔A- Explore an FHA Energy Efficiency
loan
✔✔The client later purchases a home that was built in 1935. There have been several
sewer backups, and the client was told that the pipes are clay and tree roots have
grown into the pipes and are causing the blockage. The recommendation is to replace
the pipes with PVC, with an estimated cost of $6,000. Another recommendation is to
replace the old galvanized pipes with copper pipes with an estimated cost of $7,000.
The client also mentioned the huge cost in heating bills. The windows in the home are
the original windows.
Which is the best advice a housing counselor can offer for this client to prepare and
save for major household
repairs? - ✔✔Create a system maintenance plan
,✔✔Which action could assist this client in addressing her current maintenance
concerns?
A- Install window insulation kits
B- Install an ENERGY STAR qualified water heater
C- Install low-flow toilets
D- Plant shrubs and trees to provide shade - ✔✔A- Install window insulation kits
✔✔Which is the best advice a housing counselor can provide to this client who missed
a few mortgage payments, if she wants to refinance at a lower rate to
avoid missing additional payments?
A- Discuss alternatives as refinancing is not likely to be approved
B- Discourage refinancing as it cannot help a client avoid foreclosure
C- Encourage her to refinance the mortgage with her current lender
D- Encourage her to refinance the mortgage with a different lender - ✔✔A- Discuss
alternatives as refinancing is not likely to be approved
✔✔After how many days can foreclosure proceedings begin if the client is not being
evaluated for loss mitigation, and has missed payments on an FHA loan? - ✔✔120 days
✔✔Which is the most likely consequence of missing a single mortgage payment? -
✔✔Late fees may be charged
✔✔Which is the best advice a housing counselor can provide about an emergency
preparedness plan?
A- Make a plan for all emergencies to ensure the safety and security of family members
B- Assign responsibilities only to adults in the event of a disaster
C- Plan a way to seal off the home if advised by authorities to shelter in place
D- Plan a safe escape route from the home - ✔✔D- Plan a safe escape route from the
home
✔✔Which is the best advice a housing counselor should give the client about an
emergency preparedness plan?
A- Designate a nearby restaurant as a meeting spot
B- Ensure that valuables are retrieved from the safe during a fire
C- Encourage involvement of the entire family
D- Make sure everyone has a spare cell phone to communicate - ✔✔C- Encourage
involvement of the entire family
, ✔✔Which is the best financing option for the client to complete multiple home repairs
over time without
refinancing?
A- Home Equity Line of Credit
B- FHA 203K Loan
C- Streamlined 203k Loan
D- Home Equity Loan - ✔✔A- Home Equity Line of Credit
✔✔This client has $25,000 of equity in her home and needs $49,000 to replace her
windows and pipes. Which
finance option should the housing counselor recommend?
A- Conventional Mortgage
B- Second Mortgage
C- FHA 203k
D- Home Equity Line of Credit - ✔✔C- FHA 203k
NOTE: An FHA 203k loan is based on the future value of the property after repairs and
will provide the funds for home improvements beyond the current equity in the house.
✔✔Which is the key advantage of the client using a real estate agent versus selling her
house on her own?
A- Real estate agents offer legal advice about the home buying process.
B- Real estate agents perform the home inspection.
C- Real estate agents negotiate on behalf of the client.
D- Real estate agents explain homeowner's insurance to the buyer. - ✔✔C- Real estate
agents negotiate on behalf of the client.
✔✔Which document should the client expect to sign to begin the home sale process?
A- Uniform Residential Loan Application
B- Upfront commission arrangement
C- Listing agreement
D- Home inspection contract - ✔✔C- Listing agreement
✔✔The client decides to sell her home and wants to complete various home repairs
before listing the property for sale. Which is the best reason to complete the repairs?
A- Eliminates the need for property disclosure because repairs are visible
B- Protects the client from potential lawsuits resulting from disrepair
C- Reduces the need for a home inspection, saving the buyer money
D- Helps the seller prepare for the home inspections - ✔✔D- Helps the seller prepare
for the home inspections
QUESTIONS AND ANSWERS FIRM A+
✔✔The client finally leaves her home and moves to a rental and is concerned about
being displaced if the apartment becomes unlivable. Which is the best advice the
counselor can provide?
A- Have a designated emergency credit card
B- Purchase a renters insurance policy that only covers contents and personal liability
C- Plan to apply rent payments to hotel expenses
D- Purchase a renters insurance policy that includes loss-of-use coverage - ✔✔D-
Purchase a renters insurance policy that includes loss-of-use coverage
✔✔Which is the best advice a housing counselor can give this client who is concerned
about high heating bills and wants information on how to plan for home maintenance?
A- Create a list of each key system in her home with target dates for maintenance and
replacement
B- Use emergency funds to deal with system maintenance and replacement
C- Purchase a home warranty annually to ensure her home is properly protected from
maintenance costs
D- Do maintenance and replacement only when they lead to significant financial tax
benefits - ✔✔A- Create a list of each key system in her home with target dates for
maintenance and replacement
✔✔Which is the best initial advice a housing counselor can provide if the client needs to
replace old windows in her home?
A- Explore an FHA Energy Efficiency loan
B- Advise the client to replace one window at a time so the project is more affordable
C- Visit ready.gov to learn about home energy improvement projects
D- Hire a home energy efficiency inspector - ✔✔A- Explore an FHA Energy Efficiency
loan
✔✔The client later purchases a home that was built in 1935. There have been several
sewer backups, and the client was told that the pipes are clay and tree roots have
grown into the pipes and are causing the blockage. The recommendation is to replace
the pipes with PVC, with an estimated cost of $6,000. Another recommendation is to
replace the old galvanized pipes with copper pipes with an estimated cost of $7,000.
The client also mentioned the huge cost in heating bills. The windows in the home are
the original windows.
Which is the best advice a housing counselor can offer for this client to prepare and
save for major household
repairs? - ✔✔Create a system maintenance plan
,✔✔Which action could assist this client in addressing her current maintenance
concerns?
A- Install window insulation kits
B- Install an ENERGY STAR qualified water heater
C- Install low-flow toilets
D- Plant shrubs and trees to provide shade - ✔✔A- Install window insulation kits
✔✔Which is the best advice a housing counselor can provide to this client who missed
a few mortgage payments, if she wants to refinance at a lower rate to
avoid missing additional payments?
A- Discuss alternatives as refinancing is not likely to be approved
B- Discourage refinancing as it cannot help a client avoid foreclosure
C- Encourage her to refinance the mortgage with her current lender
D- Encourage her to refinance the mortgage with a different lender - ✔✔A- Discuss
alternatives as refinancing is not likely to be approved
✔✔After how many days can foreclosure proceedings begin if the client is not being
evaluated for loss mitigation, and has missed payments on an FHA loan? - ✔✔120 days
✔✔Which is the most likely consequence of missing a single mortgage payment? -
✔✔Late fees may be charged
✔✔Which is the best advice a housing counselor can provide about an emergency
preparedness plan?
A- Make a plan for all emergencies to ensure the safety and security of family members
B- Assign responsibilities only to adults in the event of a disaster
C- Plan a way to seal off the home if advised by authorities to shelter in place
D- Plan a safe escape route from the home - ✔✔D- Plan a safe escape route from the
home
✔✔Which is the best advice a housing counselor should give the client about an
emergency preparedness plan?
A- Designate a nearby restaurant as a meeting spot
B- Ensure that valuables are retrieved from the safe during a fire
C- Encourage involvement of the entire family
D- Make sure everyone has a spare cell phone to communicate - ✔✔C- Encourage
involvement of the entire family
, ✔✔Which is the best financing option for the client to complete multiple home repairs
over time without
refinancing?
A- Home Equity Line of Credit
B- FHA 203K Loan
C- Streamlined 203k Loan
D- Home Equity Loan - ✔✔A- Home Equity Line of Credit
✔✔This client has $25,000 of equity in her home and needs $49,000 to replace her
windows and pipes. Which
finance option should the housing counselor recommend?
A- Conventional Mortgage
B- Second Mortgage
C- FHA 203k
D- Home Equity Line of Credit - ✔✔C- FHA 203k
NOTE: An FHA 203k loan is based on the future value of the property after repairs and
will provide the funds for home improvements beyond the current equity in the house.
✔✔Which is the key advantage of the client using a real estate agent versus selling her
house on her own?
A- Real estate agents offer legal advice about the home buying process.
B- Real estate agents perform the home inspection.
C- Real estate agents negotiate on behalf of the client.
D- Real estate agents explain homeowner's insurance to the buyer. - ✔✔C- Real estate
agents negotiate on behalf of the client.
✔✔Which document should the client expect to sign to begin the home sale process?
A- Uniform Residential Loan Application
B- Upfront commission arrangement
C- Listing agreement
D- Home inspection contract - ✔✔C- Listing agreement
✔✔The client decides to sell her home and wants to complete various home repairs
before listing the property for sale. Which is the best reason to complete the repairs?
A- Eliminates the need for property disclosure because repairs are visible
B- Protects the client from potential lawsuits resulting from disrepair
C- Reduces the need for a home inspection, saving the buyer money
D- Helps the seller prepare for the home inspections - ✔✔D- Helps the seller prepare
for the home inspections
