HUD Housing Counseling Exam/ 357 Quizzes &
Correct Ans.
Type of credit used - Answer: Positive: Different types of credit show variety -
demonstrates that consumers can manage different types of credit
Negative: Fever types show limited profile info - higher risk
Length of credit history - Answer: -How long a person has bad credit
Positive: Longer credit history provides more info for lenders - lower risk
Negative- shorter history provides little to no info for lenders - higher risk
Capacity Used - Answer: -How much of credit available has the person used
Positive: low credit utilization = financial management
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,Negative: High credit card balances = poor financial management - maxed out
credit cards
Strategies to increase income (9) - Answer: -Find second job
-Work Over time
-Negotiate higher salary / wage
-Sell assets (e.g. car)
-Hold a yard/garage sale
-Teach a skill / craft/ activity
-Sell a craft
_Charge rent (adult +dependents living @ home)
-Evaluate tax withholding's (if over-with holding) change to increase income
received)
Items to include when tracking expenses - Answer: Monthly bills (utilities, cell
phone, etc.) All Fixed monthly expenses all cash expenses
Seasonal or annual expenses (i.e car registration, gifts, holiday season, vacation)
Documents to use when tracking expenses - Answer: -Bills
-Bank statements
-Credit cards statements
-Records for estimated amount of expected periodic expense
Chapter 7 bankruptcy - Answer: Liquidation bankruptcy
-Process of selling non-exempt assets to repay creditors in Chapter 7 bankruptcy
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,-Must meet w/an attorney to determine ability to repay debts - means test
Tips for avoiding predatory lending - Answer: 1.Shop for a loan
2.Ask questions
3.Beware of deals that sound to o good to be true
4. Know and understand you financial situation
Credit Score - Answer: A numerical interpretation of a customer's
creditworthiness based on information in his/her credit report
How to fix:
No credit / Poor credit / Limited Credit - Answer: -Open a credit card
-Secured credit card
Items to include when tracking income - Answer: -Regular salary
-Temporary jobs
-Unemployment compensation
-Public assistance
Items not to include when tracking income - Answer: -Pre -tax payroll deductions
-Credit report
Things to consider when choosing a bank account - Answer: Services Fees-
account maintenance, wire transfer, check purchasing, money order, negligence
fees - overdraft, stop payments, insufficient funds
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, Fun access features-location, ATM'S, online banking, customer service
Common Predatory Lending tactics - Answer: 1. Limited time offers
2. High risk loans (consulting / unclear terms)
3. Higher loan amounts (more than person can afford)
4. High fees or cost
5. False of hidden disclosures
6. Loan flipping (encouraged to refinance existing loans)
Strategies for advising clients on investing for retirement - Answer: -Explain
importance of savings for retirement
-Highlight the benefits of tax-incentivize accounts
Features of a good - Large purchase savings account - Answer: For large purchase
-Limited accessibility
-Good returns-
*High-interest savings
*Money market
*Cd
Features of a good emergency fund account - Answer: -Liquid-money can be
retrieved w/o penalties
-Direct deposit or automatic transfer available
-Limited accessibility (not tempted to dip into it)
i.e.-interest bearing savings accts. money market accts
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Correct Ans.
Type of credit used - Answer: Positive: Different types of credit show variety -
demonstrates that consumers can manage different types of credit
Negative: Fever types show limited profile info - higher risk
Length of credit history - Answer: -How long a person has bad credit
Positive: Longer credit history provides more info for lenders - lower risk
Negative- shorter history provides little to no info for lenders - higher risk
Capacity Used - Answer: -How much of credit available has the person used
Positive: low credit utilization = financial management
Page 1 of 81
,Negative: High credit card balances = poor financial management - maxed out
credit cards
Strategies to increase income (9) - Answer: -Find second job
-Work Over time
-Negotiate higher salary / wage
-Sell assets (e.g. car)
-Hold a yard/garage sale
-Teach a skill / craft/ activity
-Sell a craft
_Charge rent (adult +dependents living @ home)
-Evaluate tax withholding's (if over-with holding) change to increase income
received)
Items to include when tracking expenses - Answer: Monthly bills (utilities, cell
phone, etc.) All Fixed monthly expenses all cash expenses
Seasonal or annual expenses (i.e car registration, gifts, holiday season, vacation)
Documents to use when tracking expenses - Answer: -Bills
-Bank statements
-Credit cards statements
-Records for estimated amount of expected periodic expense
Chapter 7 bankruptcy - Answer: Liquidation bankruptcy
-Process of selling non-exempt assets to repay creditors in Chapter 7 bankruptcy
Page 2 of 81
,-Must meet w/an attorney to determine ability to repay debts - means test
Tips for avoiding predatory lending - Answer: 1.Shop for a loan
2.Ask questions
3.Beware of deals that sound to o good to be true
4. Know and understand you financial situation
Credit Score - Answer: A numerical interpretation of a customer's
creditworthiness based on information in his/her credit report
How to fix:
No credit / Poor credit / Limited Credit - Answer: -Open a credit card
-Secured credit card
Items to include when tracking income - Answer: -Regular salary
-Temporary jobs
-Unemployment compensation
-Public assistance
Items not to include when tracking income - Answer: -Pre -tax payroll deductions
-Credit report
Things to consider when choosing a bank account - Answer: Services Fees-
account maintenance, wire transfer, check purchasing, money order, negligence
fees - overdraft, stop payments, insufficient funds
Page 3 of 81
, Fun access features-location, ATM'S, online banking, customer service
Common Predatory Lending tactics - Answer: 1. Limited time offers
2. High risk loans (consulting / unclear terms)
3. Higher loan amounts (more than person can afford)
4. High fees or cost
5. False of hidden disclosures
6. Loan flipping (encouraged to refinance existing loans)
Strategies for advising clients on investing for retirement - Answer: -Explain
importance of savings for retirement
-Highlight the benefits of tax-incentivize accounts
Features of a good - Large purchase savings account - Answer: For large purchase
-Limited accessibility
-Good returns-
*High-interest savings
*Money market
*Cd
Features of a good emergency fund account - Answer: -Liquid-money can be
retrieved w/o penalties
-Direct deposit or automatic transfer available
-Limited accessibility (not tempted to dip into it)
i.e.-interest bearing savings accts. money market accts
Page 4 of 81
