HUD Housing Counselor Exam

A1: Which document should the counselor review with the client to identify spending habits and track expenses? -ANSWER- Bank statement. Reviewing the client's bank statement is an important step in identifying spending habits, because it provides insight into actual income and expense transactions. A1: Which additional information would the housing counselor need to prepare a household budget besides gross income and expenses? -ANSWER- Net income. The scenario provides the gross income and total expense, but the counselor needs the net income to prepare a realistic budget. A1: Which item in the client's budget is a fixed expense? Food, gas, utilities & car payment. -ANSWER- Car lease payment. A car lease will have a fixed monthly payment. Other expenses - like food, gas, and utilities - can vary. A1: What is the maximum percent of area median income allowable for a household to qualify for a Housing Choice Voucher? -ANSWER- 50%. According to HUD's Housing Choice Voucher eligibility guidelines, a household income cannot exceed 50% of the area median income to initially qualify. A1: What is the maximum recommended housing ratio for renting an apartment? -ANSWER- 30%. The maximum housing ratio recommended for renters is 30% of gross income. A1: Eligibility requirements for downpayment assistance programs include which factors? -ANSWER- Eligibility varies depending on the program but is typically based on income, homebuyer education, and the price of the property being purchased. A1: What is the upfront mortgage insurance premium (UFMIP) for an FHA mortgage? -ANSWER- The upfront mortgage insurance premium (UFMIP) is 1.75% for FHA mortgages. The annual MIP for FHA mortgages ranges between 0.8% and 1.05%. USDA loans charge an up-front Guarantee Fee of 2%. A1: Which situation might cause an accelerated loan payment? -ANSWER- Client moves to his wife's home and rents his townhouse to a tenant. Many downpayment assistance programs (DPA) require owner occupancy. The recapture clause is triggered when the husband rents or sells the townhouse, but the loan can be assumed by an eligible buyer. A1: If the client was denied a mortgage loan and the lender told him to come back after his divorce had been final for three years, what is the best advice for the housing counselor to provide to the client? -ANSWER- Contact the FTC as the lender's action might violate the ECOA, which states: Federal law requires lenders to make credit available equally without discrimination based on race, color, religion, national origin, age, sex, marital status, or receipt of income from public assistance programs. This client's marital status of 'single' or 'divorced' should have no effect on the approval of the mortgage loan. A1: A question from a lender on which topic would be inappropriate? Debt, income, employment, or medical history. -ANSWER- Medical history. To complete a loan application, the lender must ask questions about debt, income, and employment history. Questions about the client's medical history, especially pertaining to a disability, could indicate discrimination. A1: Which is a responsibility of a housing counselor? Educate homebuyers about their rights, selecting