HUD Practice Test and Correct Answers

client does not receive a written monthly statement from the credit card company. Which credit law could this omission violate? - Fair Credit Billing Act A client earns a salary of $45,000 at a job held for three years. The client has credit card bills, student loans, and a car loan totaling $500 per month. The client has already saved $3,500 for a down payment and is using an FHA Energy Efficient Mortgage (EEM). If the client wants to make the minimum down payment for a home priced at $150,000, how much more does the client need to save? - $1,750 A client has a monthly household income of $2,300, monthly debt payments of $450, and an optimal monthly housing ratio of 32%. What is the client's optimal monthly housing payment? - $736 Use Front-End Ratio A client has saved money for a small down payment and closing costs to purchase a $100,000 home in the city. The client is deciding whether to begin the homebuying process now or continue saving for a larger down payment. Which loan type would provide the highest monthly payment, assuming interest rates and other factors are equal? - FHA Loan A client is currently renting month to month (tenancy at sufferance). What advice should a housing counselor recommend to better secure the housing? - Seek a new written lease agreement A client is delinquent on the mortgage and at risk of default. The client is considering signing the deed over to a real estate investor to avoid foreclosure. What should the housing counselor recommend? - Advise against signing over the deed to a real estate investor as a solution to avoid foreclosure. A client is in the process of purchasing a home with a sales price of $162,000. The client has a net worth of $50,000, a credit score of 680, and a debt-to-income ratio of 36%. The home has appraised for $155,000. Which factor of creditworthiness will most likely be an obstacle to purchasing the home? - Collateral A client keeps having budget problems due to unexpected expenses. Which financial tool would best assist this client to prepare for unexpected expenses and avoid increasing credit usage? - Emergency Funds