HUD PRACTICE TEST QUESTIONS AND CORRECT ANSWERS 2025

HUD PRACTICE TEST QUESTIONS AND
CORRECT ANSWERS 2025
WhichRdocumentRisRmostRimportantRwhenRworkingRwithRaRclientRtoRdevelopRanRinitialRbudgetRasRpartRofRaR
ClientRActionRPlan?R-RCORRECTRANSWERR-PayRStub



ARclientRwouldRlikeRtoRpurchaseRaRhomeRwithinRoneRyear.RTheRclientRisRmotivatedRtoRincreaseRhouseholdRin
comeRasRaRwayRtoRsaveRforRaRdownRpaymentRandRqualifyRforRaRloan.RWhichRisRthe

bestRsolutionRforRtheRclientRtoRreachRthisRgoal?R-RCORRECTRANSWERR-FindRaRsecondRjob



ARcreditRreportRmayRcontainRwhichRinformation?R-RCORRECTRANSWERR-
TheRnumberRofRaccountsRinRcollectionRstatus



SixRmonthsRagoRaRclientRleftRaRjobRasRaRreporterRtoRstartRa

businessRinRtheRretailRindustry.RToRprepareRtoRbuyRaRhouse,RtheRclientRclosedRcreditRcardRaccountsRandRhasR
beenRusingRsavingsRto

payRdownRcreditRcardRdebtRandRcollections.RTheRclientRhasRnot

beenRableRtoRsaveRmuchRforRaRdownRpaymentRwithRallRtheRdebt

paymentsRbutRknowsRaboutRanRaffordableRhomeownership

programRthatRonlyRrequiresRaR1%RdownRpaymentRwithRanRFHA

loan.RWhatRmightRresultRfromRtheRclientRclosingRtheRcreditRcard

accounts?R-RCORRECTRANSWERR-ItRincreasesRcreditRutilization,RcausingRaRnegativeRimpactRonRtheRcredit

score.



WhichRactionRwouldRaRclientRtakeRtoRimproveRaRcreditRscore?R-RCORRECTRANSWERR-
PayRdelinquentRaccounts



ARclientRdoesRnotRreceiveRaRwrittenRmonthlyRstatementRfromRtheRcreditRcardRcompany.RWhichRcreditRlawRc
ouldRthisRomissionRviolate?R-RCORRECTRANSWERR-FairRCreditRBillingRAct



ARclientRshoppingRforRaRmortgageRloanRpresentsRaRhousingRcounselorRwithRanRofferRfromRaRlocalRmortgageR
lender.RTheRinterestRrateRonRtheRofferRisR7.5%RforRaR30-

, yearRfixedRrateRmortgageRwithRaR20%RdownRpaymentRrequired.RTheRcounselorRreviewsRtheRclientRfileRandR
determinesRtheRclient'sRcreditRscoreRisR725RandRtheRclient'sRtotalRdebt-to-incomeRratioRisR20%.R-
RCORRECTRANSWERR-

"IRamRunableRtoRdetermineRwhetherRtheRloanRisRpredatory,RbutRIRsuggestRyouRshopRaroundRwithRotherRlend
ingRsources."



WhichRactionRshouldRaRcounselorRrecommendRaRclientRtakeRfirstRafterRdiscoveringRidentityRtheft?R-
RCORRECTRANSWERR-FileRanRidentityRtheftRreport




InRwhichRsituationRwouldRaRclient'sRresponsibilities,RrecurringRcosts,RandRupfrontRcostsRbeRevaluated?R-
RCORRECTRANSWERR-WhenRweighingRhousingRoptions




ARclientRworksR40RhoursRaRweekRmakingR$15RanRhour.RWhatRisRtheRhighestRmonthlyRmortgageRtheRclientRca
nRaffordRbasedRonRincomeRifRtheRclientRsecuresRaRconventionalRloan?R-RCORRECTRANSWERR-$728



WhichRtypeRofRgovernmentRinsuredRloanRwasRcreatedRforRfinancingRhomesRinRruralRareas?R-
RCORRECTRANSWERR-USDA




ARclientRkeepsRhavingRbudgetRproblemsRdueRtoRunexpectedRexpenses.RWhichRfinancialRtoolRwouldRbestRass
istRthisRclientRtoRprepareRforRunexpectedRexpensesRandRavoidRincreasingRcreditRusage?R-
RCORRECTRANSWERR-EmergencyRFunds




ARclientRhasRaRmonthlyRhouseholdRincomeRofR$2,300,RmonthlyRdebtRpaymentsRofR$450,RandRanRoptimalRm
onthlyRhousingRratioRofR32%.RWhatRisRtheRclient'sRoptimalRmonthlyRhousingRpayment?R-
RCORRECTRANSWERR-$736



UseRFront-EndRRatio



WhatRisRtheRback-
endRratioRforRaRclientRwithRaRmonthlyRhousingRexpenseRofR$1,250,RaRmonthlyRtotalRofR$88RinRotherRconsum
erRdebtRpayments,RandRaRgrossRhouseholdRincomeRofR$4,460RperRmonthR(roundedRtoRtheRnearestRwholeRp
ercent)?R-RCORRECTRANSWERR-30%



ARclientRearnsRaRsalaryRofR$45,000RatRaRjobRheldRforRthreeRyears.RTheRclientRhasRcreditRcardRbills,RstudentRlo
ans,RandRaRcarRloanRtotalingR$500RperRmonth.RTheRclientRhasRalreadyRsavedR$3,500RforRaRdownRpaymentRa
ndRisRusingRanRFHAREnergyREfficientRMortgageR(EEM).RIfRtheRclientRwantsRtoRmakeRtheRminimumRdownRpay