HUD CERTIFICATION TESTS COMPILATION
BUNDLE EXAMS SET 2026 FULL SOLUTIONS
AND CORRECT ANSWERS GRADED A+
⩥ Which is the most likely consequence of a short sale?
A- The client may need to make arrangements to pay off mortgage
deficiency.
B- The forgiven mortgage deficiency may be treated as taxable income.
C- The mortgage deficiency may be added to the future sales price of the
home.
D- The mortgage company may sue the homeowner for the deficiency
amount owed. Answer: B- The forgiven mortgage deficiency may be
treated as taxable income.
NOTE: Most short sales will have a deficiency, but in most cases the
lender will not require payment of the remaining balance and can request
that the option for a deficiency judgment be removed. However, the
forgiven balance may be treated as taxable income for the borrower.
⩥ The client is afraid her servicer might begin foreclosure proceedings
immediately and force her out of her home. Which information should
the housing counselor provide?
,A- As long as the client is working with a housing counselor, the
servicer cannot file for foreclosure.
B- A mortgage servicer cannot make a first notice for foreclosure until a
borrower is more than 120 days
delinquent.
C- If the client makes a partial payment, it will delay foreclosure.
D- The client is not yet in default. Answer: B- A mortgage servicer
cannot make a first notice for foreclosure until a borrower is more than
120 days delinquent.
⩥ If the client decides to leave the home, which option would most
likely require the least amount of time?
A- Deed-in-lieu
B- Foreclosure
C- Short sale
D- Pre-foreclosure sale Answer: A- Deed-in-lieu
If the servicer cooperates, a deed-in-lieu will take the least amount of
time. The foreclosure process can vary from state to state and can take
several months to several years to complete. A short sale is "short" on
the principal balance of the loan, though the timeline for completion is
typically not very short. Pre-foreclosure sale means selling the property
prior to foreclosure, which may or may not be a short sale.
Reference: Module 5.3 Disposition Options
,Page Number 4 to 6
⩥ The client is also behind on her credit card debt and has only a few
job prospects. She is considering filing for bankruptcy but wants to keep
her home. Which advice should the housing counselor provide?
A- Suggest the client file for a Chapter 13 bankruptcy
B- Suggest the client file for a Chapter 7 bankruptcy
C- Provide the client with the name of a bankruptcy attorney
D- Explore loss mitigation options available Answer: D- Explore loss
mitigation options available
⩥ Which is a bankruptcy qualification that considers income and equity
in assets to determine if a client has the ability to repay part of the debt?
Answer: Means test
⩥ The client was laid off from her job five months ago. Based on the
information provided, if the client had an FHA-insured mortgage which
loss mitigation option
would her servicer likely suggest first? Answer: Special Forbearance -
Unemployment Agreement
⩥ The client and her housing counselor request an FHA Special
Forbearance-Unemployment Agreement from the client's servicer.
Which is a key feature of this type of agreement?
, A- The agreement will expire 60 days after she becomes employed.
B- The client will have to show surplus income over the minimum limit.
C- It will temporarily suspend and/or reduce the client's monthly
mortgage payment.
D- The client will have to successfully complete a Trial Payment Plan.
Answer: C- It will temporarily suspend and/or reduce the client's
monthly mortgage payment
⩥ For which loss mitigation option would this unemployed client be
approved if she has an FHA loan?
A- Standalone Partial Claim
B- Special Forbearance - Unemployment Agreement
C- FHA-HAMP Loan Modification
D- Freddie Mac Flex Modification Answer: B- Special Forbearance -
Unemployment Agreement
⩥ Because she has exhausted her reserves the client is concerned about
how she will find a new place to live should she not succeed in her goal
of saving her home. Which information should the housing counselor
provide?
BUNDLE EXAMS SET 2026 FULL SOLUTIONS
AND CORRECT ANSWERS GRADED A+
⩥ Which is the most likely consequence of a short sale?
A- The client may need to make arrangements to pay off mortgage
deficiency.
B- The forgiven mortgage deficiency may be treated as taxable income.
C- The mortgage deficiency may be added to the future sales price of the
home.
D- The mortgage company may sue the homeowner for the deficiency
amount owed. Answer: B- The forgiven mortgage deficiency may be
treated as taxable income.
NOTE: Most short sales will have a deficiency, but in most cases the
lender will not require payment of the remaining balance and can request
that the option for a deficiency judgment be removed. However, the
forgiven balance may be treated as taxable income for the borrower.
⩥ The client is afraid her servicer might begin foreclosure proceedings
immediately and force her out of her home. Which information should
the housing counselor provide?
,A- As long as the client is working with a housing counselor, the
servicer cannot file for foreclosure.
B- A mortgage servicer cannot make a first notice for foreclosure until a
borrower is more than 120 days
delinquent.
C- If the client makes a partial payment, it will delay foreclosure.
D- The client is not yet in default. Answer: B- A mortgage servicer
cannot make a first notice for foreclosure until a borrower is more than
120 days delinquent.
⩥ If the client decides to leave the home, which option would most
likely require the least amount of time?
A- Deed-in-lieu
B- Foreclosure
C- Short sale
D- Pre-foreclosure sale Answer: A- Deed-in-lieu
If the servicer cooperates, a deed-in-lieu will take the least amount of
time. The foreclosure process can vary from state to state and can take
several months to several years to complete. A short sale is "short" on
the principal balance of the loan, though the timeline for completion is
typically not very short. Pre-foreclosure sale means selling the property
prior to foreclosure, which may or may not be a short sale.
Reference: Module 5.3 Disposition Options
,Page Number 4 to 6
⩥ The client is also behind on her credit card debt and has only a few
job prospects. She is considering filing for bankruptcy but wants to keep
her home. Which advice should the housing counselor provide?
A- Suggest the client file for a Chapter 13 bankruptcy
B- Suggest the client file for a Chapter 7 bankruptcy
C- Provide the client with the name of a bankruptcy attorney
D- Explore loss mitigation options available Answer: D- Explore loss
mitigation options available
⩥ Which is a bankruptcy qualification that considers income and equity
in assets to determine if a client has the ability to repay part of the debt?
Answer: Means test
⩥ The client was laid off from her job five months ago. Based on the
information provided, if the client had an FHA-insured mortgage which
loss mitigation option
would her servicer likely suggest first? Answer: Special Forbearance -
Unemployment Agreement
⩥ The client and her housing counselor request an FHA Special
Forbearance-Unemployment Agreement from the client's servicer.
Which is a key feature of this type of agreement?
, A- The agreement will expire 60 days after she becomes employed.
B- The client will have to show surplus income over the minimum limit.
C- It will temporarily suspend and/or reduce the client's monthly
mortgage payment.
D- The client will have to successfully complete a Trial Payment Plan.
Answer: C- It will temporarily suspend and/or reduce the client's
monthly mortgage payment
⩥ For which loss mitigation option would this unemployed client be
approved if she has an FHA loan?
A- Standalone Partial Claim
B- Special Forbearance - Unemployment Agreement
C- FHA-HAMP Loan Modification
D- Freddie Mac Flex Modification Answer: B- Special Forbearance -
Unemployment Agreement
⩥ Because she has exhausted her reserves the client is concerned about
how she will find a new place to live should she not succeed in her goal
of saving her home. Which information should the housing counselor
provide?
