HUD Exam Prep 2026 Questions and
Answers
Conventional Loan - Correct answer-Front end 28%
Back end 36% can go up to 45% to 50%(debt to income), backed by private
lenders. AKA prime loans. Good credit, 20% down payment. May have interest
only terms
FHA - Correct answer-Front end 31%
Back end 43%
Limited funds, bad credit, bankruptcy, high debt to income ratio.
EEM (Energy) FHA - Correct answer-Front end 33%
Back end 45%
VA - Correct answer-41%
USDA - Correct answer-Front End 29%
Back End 41%, low-to-moderate income, must live rural area, no down payment,
competitive rates. Bellow 115% median income. Loan term 33 to 38 yrs
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,Equal Credit Opportunity Act (ECOA) - Correct answer-A federal act, which
prohibits discrimination by lenders on the basis of sex or marital status in any
aspect of a credit transaction.
Front end Ratio - Correct answer-PITIA/ Gross Income
Within three days of receiving a loan application, lenders are required to supply the
client with - Correct answer-Loan Estimate
How may years at a job to show employment stability? - Correct answer-At least 2
years
Which factor determines whether the client will have to pay private mortgage
insurance versus mortgage insurance premium - Correct answer-Type of loan
The Fair Housing Act - Correct answer-The federal law that prohibits
discrimination in housing based on race, color, religion, sex, handicap, familial
status, and national origin
The Housing and Urban Development Act - Correct answer-providing government-
insured loans to moderate-income people.
The Dodd-Frank Act - Correct answer-protects borrowers from predatory lending
practices
©COPYRIGHT 2025 ALL RIGHTS RESERVED 2
, Affirmatively Furthering Fair Housing (AFFH) - Correct answer-Advocating for
lenders to operate in underserved areas
After how many days can foreclosure proceedings begin if the client is not being
evaluated for loss mitigation, and has missed payments on an FHA loan - Correct
answer-120
FHA 203K Loan - Correct answer-allows the homeowner to refinance the home
loan to perform repair
Streamlined 203K Loan - Correct answer-minor rehabilitation and/or home
improvement projects that will not require the involvement of consultants,
engineers, and/or architects
key advantage of the client using a real estate agent versus selling her house on her
own - Correct answer-Real estate agents negotiate on behalf of the client.
A means test - Correct answer-bankruptcy qualification that considers income and
equity in assets to determine if a client has the ability to repay part of the debt
Default - Correct answer-when a payment has not been made after 60 to 90 days.
FHA 30 days
Delinquent - Correct answer-timely mortgage payments by the end of the grace
period (14 day)
©COPYRIGHT 2025 ALL RIGHTS RESERVED 3
Answers
Conventional Loan - Correct answer-Front end 28%
Back end 36% can go up to 45% to 50%(debt to income), backed by private
lenders. AKA prime loans. Good credit, 20% down payment. May have interest
only terms
FHA - Correct answer-Front end 31%
Back end 43%
Limited funds, bad credit, bankruptcy, high debt to income ratio.
EEM (Energy) FHA - Correct answer-Front end 33%
Back end 45%
VA - Correct answer-41%
USDA - Correct answer-Front End 29%
Back End 41%, low-to-moderate income, must live rural area, no down payment,
competitive rates. Bellow 115% median income. Loan term 33 to 38 yrs
©COPYRIGHT 2025 ALL RIGHTS RESERVED 1
,Equal Credit Opportunity Act (ECOA) - Correct answer-A federal act, which
prohibits discrimination by lenders on the basis of sex or marital status in any
aspect of a credit transaction.
Front end Ratio - Correct answer-PITIA/ Gross Income
Within three days of receiving a loan application, lenders are required to supply the
client with - Correct answer-Loan Estimate
How may years at a job to show employment stability? - Correct answer-At least 2
years
Which factor determines whether the client will have to pay private mortgage
insurance versus mortgage insurance premium - Correct answer-Type of loan
The Fair Housing Act - Correct answer-The federal law that prohibits
discrimination in housing based on race, color, religion, sex, handicap, familial
status, and national origin
The Housing and Urban Development Act - Correct answer-providing government-
insured loans to moderate-income people.
The Dodd-Frank Act - Correct answer-protects borrowers from predatory lending
practices
©COPYRIGHT 2025 ALL RIGHTS RESERVED 2
, Affirmatively Furthering Fair Housing (AFFH) - Correct answer-Advocating for
lenders to operate in underserved areas
After how many days can foreclosure proceedings begin if the client is not being
evaluated for loss mitigation, and has missed payments on an FHA loan - Correct
answer-120
FHA 203K Loan - Correct answer-allows the homeowner to refinance the home
loan to perform repair
Streamlined 203K Loan - Correct answer-minor rehabilitation and/or home
improvement projects that will not require the involvement of consultants,
engineers, and/or architects
key advantage of the client using a real estate agent versus selling her house on her
own - Correct answer-Real estate agents negotiate on behalf of the client.
A means test - Correct answer-bankruptcy qualification that considers income and
equity in assets to determine if a client has the ability to repay part of the debt
Default - Correct answer-when a payment has not been made after 60 to 90 days.
FHA 30 days
Delinquent - Correct answer-timely mortgage payments by the end of the grace
period (14 day)
©COPYRIGHT 2025 ALL RIGHTS RESERVED 3
