HUD ACTUAL PRACTICE EXAM QUESTIONS 2026-2027
COMPLETE ACCURATE EXAM REAL QUESTIONS AND
CORRECT DETAILED ANSWERS WITH RATIONALES
(RELIABLE SOLUTIONS) CURRENTLY UPDATED VERSION
2026 EDITION
Which action would a client take to improve a credit score?
ANSWERS: Pay delinquent accounts
A client does not receive a written monthly statement from the credit
card company. Which credit law could this omission violate?
ANSWERS: Fair Credit Billing Act
A client shopping for a mortgage loan presents a housing counselor with
an offer from a local mortgage lender. The interest rate on the offer is
7.5% for a 30-year fixed rate mortgage with a 20% down payment
required. The counselor reviews the client file and determines the client's
credit score is 725 and the client's total debt-to-income ratio is 20%.
ANSWERS: "I am unable to determine whether the loan is predatory, but
I suggest you shop around with other lending sources."
Which action should a counselor recommend a client take first after
discovering identity theft?
ANSWERS: File an identity theft report
In which situation would a client's responsibilities, recurring costs, and
upfront costs be evaluated?
ANSWERS: When weighing housing options
,A client works 40 hours a week making $15 an hour. What is the highest
monthly mortgage the client can afford based on income if the client
secures a conventional loan?
ANSWERS: $728
Which type of government insured loan was created for financing homes
in rural areas?
ANSWERS: USDA
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?
ANSWERS: Emergency Funds
When a lender inquires about how much money a borrower has saved for
a down payment on a home, what factor is being considered?
ANSWERS: Capital
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?
ANSWERS: $736
Use Front-End Ratio
What is the back-end ratio for a client with a monthly housing expense of
$1,250, a monthly total of $88 in other consumer debt payments, and a
gross household income of $4,460 per month (rounded to the nearest
whole percent)?
ANSWERS: 30%
, 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?
ANSWERS: $1,750
Under which condition would most down payment assistance programs
approve a waiver of the homeownership education requirement?
ANSWERS: Most will not waive the homeownership education requirement.
Which type of assistance administered by a public housing authority
allows for location flexibility?
ANSWERS: Tenant-based vouchers
A client's payment history affects which factor of creditworthiness?
ANSWERS: Character
Which action may a lender take to determine a borrower's character?
ANSWERS: Call an employer to verify employment
COMPLETE ACCURATE EXAM REAL QUESTIONS AND
CORRECT DETAILED ANSWERS WITH RATIONALES
(RELIABLE SOLUTIONS) CURRENTLY UPDATED VERSION
2026 EDITION
Which action would a client take to improve a credit score?
ANSWERS: Pay delinquent accounts
A client does not receive a written monthly statement from the credit
card company. Which credit law could this omission violate?
ANSWERS: Fair Credit Billing Act
A client shopping for a mortgage loan presents a housing counselor with
an offer from a local mortgage lender. The interest rate on the offer is
7.5% for a 30-year fixed rate mortgage with a 20% down payment
required. The counselor reviews the client file and determines the client's
credit score is 725 and the client's total debt-to-income ratio is 20%.
ANSWERS: "I am unable to determine whether the loan is predatory, but
I suggest you shop around with other lending sources."
Which action should a counselor recommend a client take first after
discovering identity theft?
ANSWERS: File an identity theft report
In which situation would a client's responsibilities, recurring costs, and
upfront costs be evaluated?
ANSWERS: When weighing housing options
,A client works 40 hours a week making $15 an hour. What is the highest
monthly mortgage the client can afford based on income if the client
secures a conventional loan?
ANSWERS: $728
Which type of government insured loan was created for financing homes
in rural areas?
ANSWERS: USDA
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?
ANSWERS: Emergency Funds
When a lender inquires about how much money a borrower has saved for
a down payment on a home, what factor is being considered?
ANSWERS: Capital
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?
ANSWERS: $736
Use Front-End Ratio
What is the back-end ratio for a client with a monthly housing expense of
$1,250, a monthly total of $88 in other consumer debt payments, and a
gross household income of $4,460 per month (rounded to the nearest
whole percent)?
ANSWERS: 30%
, 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?
ANSWERS: $1,750
Under which condition would most down payment assistance programs
approve a waiver of the homeownership education requirement?
ANSWERS: Most will not waive the homeownership education requirement.
Which type of assistance administered by a public housing authority
allows for location flexibility?
ANSWERS: Tenant-based vouchers
A client's payment history affects which factor of creditworthiness?
ANSWERS: Character
Which action may a lender take to determine a borrower's character?
ANSWERS: Call an employer to verify employment
