HUD PRACTICE TEST AND CORRECT
ANSWERS 100% CORRECT
, Which document is most important when working with a client to develop an initial
budget as part of a Client Action Plan? - ANSWERPay Stub
A client would like to purchase a home within one year. The client is motivated to
increase household income as a way to save for a down payment and qualify for a loan.
Which is the
best solution for the client to reach this goal? - ANSWERFind a second job
A credit report may contain which information? - ANSWERThe number of accounts in
collection status
Six months ago a client left a job as a reporter to start a
business in the retail industry. To prepare to buy a house, the client closed credit card
accounts and has been using savings to
pay down credit card debt and collections. The client has not
been able to save much for a down payment with all the debt
payments but knows about an affordable homeownership
program that only requires a 1% down payment with an FHA
loan. What might result from the client closing the credit card
accounts? - ANSWERIt increases credit utilization, causing a negative impact on the
credit
score.
Which action would a client take to improve a credit score? - ANSWERPay delinquent
accounts
A client does not receive a written monthly statement from the credit card company.
Which credit law could this omission violate? - ANSWERFair 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%. - ANSWER"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? - ANSWERFile an identity theft report
In which situation would a client's responsibilities, recurring costs, and upfront costs be
evaluated? - ANSWERWhen weighing housing options
ANSWERS 100% CORRECT
, Which document is most important when working with a client to develop an initial
budget as part of a Client Action Plan? - ANSWERPay Stub
A client would like to purchase a home within one year. The client is motivated to
increase household income as a way to save for a down payment and qualify for a loan.
Which is the
best solution for the client to reach this goal? - ANSWERFind a second job
A credit report may contain which information? - ANSWERThe number of accounts in
collection status
Six months ago a client left a job as a reporter to start a
business in the retail industry. To prepare to buy a house, the client closed credit card
accounts and has been using savings to
pay down credit card debt and collections. The client has not
been able to save much for a down payment with all the debt
payments but knows about an affordable homeownership
program that only requires a 1% down payment with an FHA
loan. What might result from the client closing the credit card
accounts? - ANSWERIt increases credit utilization, causing a negative impact on the
credit
score.
Which action would a client take to improve a credit score? - ANSWERPay delinquent
accounts
A client does not receive a written monthly statement from the credit card company.
Which credit law could this omission violate? - ANSWERFair 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%. - ANSWER"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? - ANSWERFile an identity theft report
In which situation would a client's responsibilities, recurring costs, and upfront costs be
evaluated? - ANSWERWhen weighing housing options
