HUD Housing Counselor Study Guide With Complete Solution

Front end ratio (parts) - Answer Monthly Housing Expense / Gross Income Back End Ratio (parts) - Answer Monthly housing+debt (on credit report - car loan, credit cards & etc) / Gross Income Renter Ratio - Answer 30% / 36% Conventional Ratio - Answer 28% / 36% FHA (Federal Housing Administration) Ratio - Answer 31% / 43% EEM - Energy Efficent Mort - Answer 33% / 45% VA - Answer 41% (must include child care with other debts) MIP - Answer Mortgage Insurance Premium FHA MIP ANNUAL COST - Answer 0.80% TO 1.05% VA MIP ANNUAL COST - Answer NONE USDA MIP ANNUAL COST - Answer 0.50% ANNUAL FEE CONVENTIONAL MIP ANNUAL COST - Answer 0.50% TO 1.50% Home equity loan - Answer Think 2nd mortgage - 1 large expense - closing costs HELOC - Answer Think line of credit - A home equity line of credit, or HELOC, is a line of credit that you can take from at any time during the draw period, up to your credit limit. Typically, the draw period is 10 years and the repayment period lasts 15 years. FHA 203(k) Rehabilitation Loan - Answer Think 1st mortgage + reno costs - must complete in 6 months - Must use a contractor - must be structural - Stream line FHA 203 (k) - Answer Think 1st mortgage + reno costs - must complete in a couple of months - Must use a contractor - must be no structural - can't exceed 35k - FHA EEM Mortgage - Answer Purchase Energy Efficient Home or Reno - Must use a HERS consultant Title 1 loan - Answer For single unit or up to 5 unit - Repairs up $25,000 Credit Ulitization Ratio - Answer 30% or lower Tracking Expenses - Answer -control your expenses by capturing spending -seasonal distribution of expenses -using budget payment plans tracking income - Answer continuously keeping up with how much money you are earning Maximum Affordable Housing Expense - Answer Front end ratio x Gross Income Debt to Income ratio - Answer Car payment + credit cards + other credit report debt + PITIA / Gross income Civil rights act of 1866 - Answer law that established federal guarantees of civil rights for all citizens Plessy vs. Ferguson - Answer Separate but equal Home Owners' Loan corporation 1933 - Answer HOLC as an effort to avoid foreclosures Redlining - Answer A process by which banks draw lines on a map and refuse to lend money to