HUD Certification Exam 2026 Questions
and Answers
Which document is most important when working with a client to develop an
initial budget as part of a Client Action Plan?
Pay stub
Retirement plan statement
List of assets
Current lease - Correct answer-Pay stub
A client would like 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?
Find a second job
Borrow from retirement fund
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,Sell major assets
Find a temporary job through a staffing service - Correct answer-Find a second job
A credit report may contain which information?
The number of accounts in collection status
A history of payments on an electric bill
Income history
Criminal record - Correct answer-The number of accounts in collection status
A credit report contains inaccurate information. Which action item should the
counselor include in the Client Action Plan?
-Attach a letter to mortgage applications explaining the inaccuracies.
-Investigate the reasons why the inaccuracies occurred to determine the responsible
party.
-Include a personal consumer statement on the credit report.
-File a dispute with the appropriate credit reporting agency. - Correct answer-File a
dispute with the appropriate credit reporting agency.
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,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 home-ownership program that only requires a 1% down
payment with an FHA loan.
What might result from the client closing the credit card accounts?
-It decreases credit utilization, causing a negative impact on the credit score.
-It increases credit utilization, causing a negative impact on the credit score.
-It increases credit utilization, causing a positive impact on the credit score.
-It decreases credit utilization, causing a positive impact on the credit score. -
Correct answer-It decreases credit utilization, causing a positive impact on the
credit score.
Which action would a client take to improve a credit score?
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, -Request to expunge public records
-Apply for new credit cards to increase credit
-Cancel all credit cards
-Pay delinquent accounts - Correct answer-Pay delinquent accounts
A client does not receive a written monthly statement from the credit card
company. Which credit law could this omission violate?
-Fair Credit Billing Act
-Fair Credit Reporting Act
-Fair Housing Act
-Fair and Accurate Credit Transactions Act - Correct answer-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%.
©COPYRIGHT 2025 ALL RIGHTS RESERVED 4
and Answers
Which document is most important when working with a client to develop an
initial budget as part of a Client Action Plan?
Pay stub
Retirement plan statement
List of assets
Current lease - Correct answer-Pay stub
A client would like 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?
Find a second job
Borrow from retirement fund
©COPYRIGHT 2025 ALL RIGHTS RESERVED 1
,Sell major assets
Find a temporary job through a staffing service - Correct answer-Find a second job
A credit report may contain which information?
The number of accounts in collection status
A history of payments on an electric bill
Income history
Criminal record - Correct answer-The number of accounts in collection status
A credit report contains inaccurate information. Which action item should the
counselor include in the Client Action Plan?
-Attach a letter to mortgage applications explaining the inaccuracies.
-Investigate the reasons why the inaccuracies occurred to determine the responsible
party.
-Include a personal consumer statement on the credit report.
-File a dispute with the appropriate credit reporting agency. - Correct answer-File a
dispute with the appropriate credit reporting agency.
©COPYRIGHT 2025 ALL RIGHTS RESERVED 2
,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 home-ownership program that only requires a 1% down
payment with an FHA loan.
What might result from the client closing the credit card accounts?
-It decreases credit utilization, causing a negative impact on the credit score.
-It increases credit utilization, causing a negative impact on the credit score.
-It increases credit utilization, causing a positive impact on the credit score.
-It decreases credit utilization, causing a positive impact on the credit score. -
Correct answer-It decreases credit utilization, causing a positive impact on the
credit score.
Which action would a client take to improve a credit score?
©COPYRIGHT 2025 ALL RIGHTS RESERVED 3
, -Request to expunge public records
-Apply for new credit cards to increase credit
-Cancel all credit cards
-Pay delinquent accounts - Correct answer-Pay delinquent accounts
A client does not receive a written monthly statement from the credit card
company. Which credit law could this omission violate?
-Fair Credit Billing Act
-Fair Credit Reporting Act
-Fair Housing Act
-Fair and Accurate Credit Transactions Act - Correct answer-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%.
©COPYRIGHT 2025 ALL RIGHTS RESERVED 4
