HUD EXAM PREP Questions with100% correct Answers

Types of Credit Used - Answer- Student loan or credit cards only FAKO scores - Answer- purchase score which are educational score Fair Credit Reporting Act FCRA - Answer- what is in file/dispute/remove 30 days/remove bad 7 yrs/bk 10 yrs/access limited/damages from violators/state rights Fair and Accurate Credit Transactions Act FACTA - Answer- free cbrs/fraud alert/truncate cc #s Fair Credit Billing Act (FCBA) - Answer- dispute bill error/mail 60 days/creditor 30 days acknowledge and 90 days research. billed timely manner/14 days before payment due Tax Credits - Answer- Earned Income Tax Credit/EITC-low/moderate income ind/families. Net earnings from self employment-income/marital status/children. Educational credit-post seconday for ind/child. Child/Dependent Care Credit-work/look for work and paying a service. additional credits under 17yo. predatory lending - Answer- loan flipping-refi existing loan for more fees and interest Chap 13 bk - Answer- 3-5 yr payment plan on all/part of debt, can stop foreclosure, cure delinquent mortgage payments, reschedule secured debts other than mortgage, lower payment, retain house/car Blockbusting - Answer- convince/attempt person to sell/rent due to entry/neighborhood of race/color/religion/familia/origin/disability Redlining - Answer- illegal practice to make residential loans due to race, neighborhood, origin, familia, sex, color Closing costs & Discount Points - Answer- Closing 3-4% and Discount 1% of total loan amount front end ratio / housing expense ratio - Answer- monthly housing exp/gross monthly income Gross Monthly Income (GMI) - Answer- hourly-10/hrx35hrsx52 wks/12......wkly 750x52wksx12=.....biwkly-1000.x26/12=....semimnth-1200.x2=...selfemploy-average gross 70587./24= back-end ratio - Answer- debt exp/gross debt to income ratio Affordability - Answer- FE/Conv 28, FHA 31, FHAEE 33, Rent 30....BE/Conv 36(45-50), FHA 43, FHAEE 45, Rent 36 Max Mnthly House Pymt - Answer- FERxgmi BERxgmi-debts 2nd mort/piggy back loan - Answer- lower 1st mort, avoid private morg ins, repairs, education mortg terms - Answer- interest only-pay only interest for a fixed term after borrower pays principal/interest, fixed rate-interest fixed 30 yrs or 10-15, Adjustable-interest adjust and has cap Loan-to-Value Ratio - Answer- LTV%=loan bal/sales price/appraised x 100 down payment - Answer- conv-varies, FHA-580+96.5%LTV or 3.5% down, LTV or 10 down, VA/USDA-none Mort Ins - Answer- Private Morg Ins-priv loans conv/subprime, Up Front-FHA, VA, USDA, Mort Ins Premium-FHA, VA, USDA Civil Rights Act of 1866 - Answer- all natural citizens except american indians 1896 Plessy v. Ferguson - Answer- ruled that segregation was allowed, as long as the facilities were "separate but equal" 1933 Home Owners Loan Corporation (HOLC) - Answer- Conress to avoid foreclosures during great depression/refinance mort in default 1948 Shelly v Kraemer - Answer- deed restrictions deemed illegal 1954 Brown v. Board of Education - Answer- This famous Supreme Court case over turned Plessy v. Ferguson. The Brown decision stated that separated but equalities were inherently unequal. 1962 Executive Order 11063 - Answer- JFK prohibit discrimination in sale/lease/rent backed by federal funds 1964 Civil Rights Act - Answer- This act prohibited Discrimination because of race, color, sex, religion, or national origin by employers or labor unions 1968 Civil Rights Act - Answer- This was passed in response to MLK Jr's assassination. Called the Fair Housing Act. Prohibits discrimination in housing sales, rentals, advertising, and financing based on race, color, national origin, and religion. It also obligated federal agencies to affirmatively further fair housing. 1968 HUD - Answer- Established Ginnie Mae, to expand the availability of government-secured home loans to moderate-income families 1974 & 1988 - Answer- 1974/sex & 1988/disability & familia 2010 LGBT - Answer- HUD issued a new policy that provides lesbian, gay, bisexual, and transgender individuals and families with further assistance when facing housing discrimination. The new guidance treats "gender identity discrimination" as gender discrimination. Extra protection for disabled - Answer- Covered multifamily dwellings available for occupancy after March 13, 1991, must be usable and accessible for persons with disabilities including design of: doors, accessible routes, environmental controls, grab bars, and usable kitchens. Section 504 of the Rehabilitation Act of 1973 - Answer- Requires that housing providers that receive federal financial assistance make and pay for structural changes to facilities, if needed as a reasonable accommodation unless doing so poses an undue financial and administrative burden. Assistant Animal - Answer- An assistance animal is not a pet. An assistance animal works, provides assistance, or performs tasks for the person or provides emotional support that alleviates one or more identified symptoms or effects of a person's disability. Assistance animals do not have to be trained or certified, and are not limited to dogs. Exemptions to the Fair Housing Act - Answer- Single Family-1. Owns, sells, or rents the house 2. Owns 3 or fewer single family homes 3. Does not use a real-estate broker. Mrs Murphy-The house or living quarter is occupied by or intended to be occupied by no more than four independent families and the owner 2. The owner has three or fewer rental units. Religious-Housing is not operated commercially 2. Housing is made available to persons of the same religion. Private Club-The housing is not open to the public 2. The housing is incidental to the primary purpose The hosing is not operated commercially. Elderly-1. Housing is designed for the elderly 2. 100% of the community is 62 or older; or 80% of the households have one resident who is 55+ Real Estate Related Transaction - Answer- According to the Fair Housing Act, a real estate related transaction means any of the following: • the making or purchasing on loans or providing other financial assistance for purchasing, constructing, improving, repairing, or maintaining a dwelling • the making or purchasing of loans or providing other financial assistance secured by residential real-estate. File a Housing Complaint - Answer- HUD, Nonprofit Fair Housing Organization FHIP/Fair Housing Initiatives Program-Identify government agencies that handle complaints Assist aggrieved individuals in filing a complaint Conduct preliminary investigations, including sending testers to properties. State/Local FHAP-Fair Housing Assistance Program-. Many states even extend additional fair housing protections that are non-existent at the federal level, such as protecting sexual orientation, gender identity, or marital status. The Fair Housing Assistance Program provides the funding to enforce these additional fair housing protections. A person may contact an FHAP to: Get help with housing discrimination Funds are also used by FHAP for: Capacity building, administrative costs, investigative and enforcement efforts, training, and other projects. Filing a Complaint - Answer- Name and contact information Name and contact information of the person you are filing against The address of the housing involved A short description of the alleged violation Date(s) of the alleged violation Complaint Process - Answer- Complainant: a person, group, or company that files a complaint which claims that someone has violated a law. Respondent: a person against whom a fair housing complaint is filed. Respondents must be identified as a specific individual, rather than an organization or group. Conciliation: the attempted resolution of issues raised by a complainant, or by the investigation of such complaint, through informal negotiations involving the aggrieved person, the respondent, and the HUD secretary. Conciliation Agreement: a written agreement setting terms for the resolution of the issues in conciliation. Complaint Process Key Intake: intake specialist reviews the complaint to determine if it is a violation of the Fair Houing Act and within HUD's jurisdiction. Complaint Filed: if the complaint meets filing criteria, an official complaint is filed. A notification is sent to the aggrieved person. A notification is also sent to the respondent within 10 days of the official complaint. The respondent may answer within 10 days. The complaint is then assigned for investigation. If the complaint has to do with an organization funded by FHAP, HUD refers complaint to that agency to investigate and only takes further action if that agency does not begin proceedings within 30 days. Complaint Rejected: if the intake specialist determines the complaint does not involve housing discrimination and is not within HUD's jurisdiction, the complaint cannot be accepted. Complaint Process Key Continued Investigation: HUD acts as a neutral third party to determine reasonable cause. HUD does the following: Interviews the complainant, respondent, and pertinent witnesses Collects relevant documents and/or conducts site visits, as appropriate May take depositions, issue subpoenas, and compel testimony or documents Continually offers and engages conciliation during the period between filing the complaint and the filing or dismissal of a charge. The investigation must be completed no later than 100 days after the filing of the complaint unless it is impractical to do so. Temporary or Preliminary Relief: If HUD concludes that irreparable harm is likely to occur, HUD may authorize prompt civil action. For example, stopping a sale. Conciliation: HUD attempts to achieve just resolution, obtain assurances that the respondent will remedy any violations, and take action to eliminate the violation. The choice to conciliate is completely voluntary. There are two types of conciliation: Pre-determination: takes place before all the evidence has been gathered in the investigation process Post-determination: takes place after the investigation has concluded, but prior to trying the issue in a court of law. Conciliation Agreement signed: if an agreement is reached, the conciliation agreement is signed and the case is closed. Conciliation may include monetary relief. If the agreement is breached, the case is escalated to the Attorney General.No Conciliation Agreement Signed or Settlement: There are two situations in which the investigation process continues even after pre-determination or post-determination: No conciliation agreement is reached: The investigation continues if no agreement can be reached Resolution with settlement is made: if only the complainant and respondent reach an agreement but HUD does not approve, this is a settlement and not conciliation and HUD may intiate a new complaint based on the original issue. Investigation Concludes as a Reasonable Cause: If a reasonable cause is determined, HUD immediately issues a charge on behalf of the aggrieved person. HUD sends a copy of the charge to each respondent and aggrieved person and provides information with options such as electing to continue the process in a U.S. district court. If this option is not elected, a hearing with an administrative law judge will occur. Option to Elect the U.S District Court: When a charge is filed, a complainant, respondent, or aggrieived person may elect to have the case heard in a civil action under the U.S. district court. In absence of an election, an administrative law judge hears the case. The election must be made no later than 20 days receipt of the charge. Hearing before the U.S District Court: No later than 30 days after any party elects to go to district court, the U.S. Department of Justice commences a civil action on behalf of the aggrieved. If the court finds that a discriminatory housing practice has or is about to occure, the court can grant punitive damages, orders, or attorney's fees paid. Hearing before the HUD Administrative Law Judge: If an election is not made to go to district court, a hearing under an ALJ occurs under no later than 120 days following the issuance of the charge. Each party may appear in person. The ALJ makes a finding no later than 60 days after the end of the hearing. If the ALJ finds that the housing violation is or is about to occur, they will issue an order of relief. Within 15 days, any party can petition HUD for further review after the judge has made their decision. Private Right of Action: An aggrieved person may commence a civil action no later than two years of an alleged violation or breach of a conciliation agreement. If a conciliation agreement has been approved by HUD and has not been breached, the civil action cannot be commenced. If the ALJ has commenced a hearing, the civil action cannot be commenced. Affirmatively Furthering Fair Housing - Answer- Identifying lender policies that have fair housing implications for clients Conducting educational initiatives to inform people about fair housing obligations Reviewing housing construc