HUD Exam Module 5.3 Questions with correct Answers

Deficiency Judgement - Answer- If the foreclosure sale does not produce enough to cover the debt the mortgagee (lender) is entitled to a ____________ against the borrower for the unpaid amount Deed in Lieu - Answer- a deed given by a mortgage lender to satisfy a debt Foreclosure - Answer- The seizure of property from borrowers who are unable to repay their loans Short Sale - Answer- lender agrees to accept sale proceeds, even if less than the debt Consequences of a homeowner going through foreclosure, short sale, or deed-in-lieu - Answer- 1. Negative impact on credit. 2. Short-term inability to secure a new prime mortgage. 3. Potential loss of equity built up in home. Cash for Keys - Answer- An alternative to a legal eviction following foreclosure. The occupant receives cash funds from the services in exchange for turning in the keys and vacating the property. Property must be broom-clean and include all appliances. What does it mean for a mortgage to be underwater? - Answer- Property is worth less than the balance owed to the lender. When a borrower is trying to avoid foreclsoure, a mortgage company will usually consider a _______ before a ____________. - Answer- short sale; deed-in-lieu Lenders often offer short sale or deed-in-lieu options for homeowners trying to sell the home quickly before attempting a regular home sale. - Answer- False After the sale date of a home, which scenario could result in an eviction, typically with little notice to the client and under the enforcement of a law officer? - Answer- Foreclosure All of the following statements are true if a client would like to secure rental housing after a foreclosure, short sale, or deed-in lieu except... 1. The client should wait until the sale is final. 2. The client should be prepared to have a co-signer. 3. The client should try to secure housing before the sale is finalized. 4. The client should have money saved for