HUD Practice Test Questions With
Correct Answers
Which |document |is |most |important |when |working |with |a |client |to |develop |an |initial |budget |as
|part |of |a |Client |Action |Plan? |- |CORRECT |ANSWER✔✔-Pay |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? |- |CORRECT |ANSWER✔✔-Find |a |second |job
A |credit |report |may |contain |which |information? |- |CORRECT |ANSWER✔✔-The |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? |- |CORRECT |ANSWER✔✔-It |increases |credit |utilization, |causing |a |negative |impact |on |
the |credit
score.
, Which |action |would |a |client |take |to |improve |a |credit |score? |- |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? |- |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%. |- |CORRECT |
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? |- |CORRECT |ANSWER✔✔-File |an |identity |theft |report
In |which |situation |would |a |client's |responsibilities, |recurring |costs, |and |upfront |costs |be |
evaluated? |- |CORRECT |ANSWER✔✔-When |weighing |housing |options
A |client |works |40 |hours |a |week |making |$15 |an |hour. |What |is |the |highest |monthly |mortgage |
the |client |can |afford |based |on |income |if |the |client |secures |a |conventional |loan? |- |CORRECT |
ANSWER✔✔-$728
Which |type |of |government |insured |loan |was |created |for |financing |homes |in |rural |areas? |- |
CORRECT |ANSWER✔✔-USDA
A |client |keeps |having |budget |problems |due |to |unexpected |expenses. |Which |financial |tool |
would |best |assist |this |client |to |prepare |for |unexpected |expenses |and |avoid |increasing |credit |
usage? |- |CORRECT |ANSWER✔✔-Emergency |Funds
Correct Answers
Which |document |is |most |important |when |working |with |a |client |to |develop |an |initial |budget |as
|part |of |a |Client |Action |Plan? |- |CORRECT |ANSWER✔✔-Pay |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? |- |CORRECT |ANSWER✔✔-Find |a |second |job
A |credit |report |may |contain |which |information? |- |CORRECT |ANSWER✔✔-The |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? |- |CORRECT |ANSWER✔✔-It |increases |credit |utilization, |causing |a |negative |impact |on |
the |credit
score.
, Which |action |would |a |client |take |to |improve |a |credit |score? |- |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? |- |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%. |- |CORRECT |
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? |- |CORRECT |ANSWER✔✔-File |an |identity |theft |report
In |which |situation |would |a |client's |responsibilities, |recurring |costs, |and |upfront |costs |be |
evaluated? |- |CORRECT |ANSWER✔✔-When |weighing |housing |options
A |client |works |40 |hours |a |week |making |$15 |an |hour. |What |is |the |highest |monthly |mortgage |
the |client |can |afford |based |on |income |if |the |client |secures |a |conventional |loan? |- |CORRECT |
ANSWER✔✔-$728
Which |type |of |government |insured |loan |was |created |for |financing |homes |in |rural |areas? |- |
CORRECT |ANSWER✔✔-USDA
A |client |keeps |having |budget |problems |due |to |unexpected |expenses. |Which |financial |tool |
would |best |assist |this |client |to |prepare |for |unexpected |expenses |and |avoid |increasing |credit |
usage? |- |CORRECT |ANSWER✔✔-Emergency |Funds
