Housing Counselor Exam Questions and Answers Already Passed

Document Content and Description Below

Housing Counselor Exam Questions and Answers Already Passed Default ✔✔When no payments made after 60 to 90 days... 30 for FHA loans Front-End Ratio Equation ✔✔Monthly housing expenses/gross... monthly income Front-End Ratio maximums ✔✔28% or less - conventional loan 31% or less for FHA, 30% or less for rentals Back-End Ratio (Debt-to-Income) Equation ✔✔total monthly debt expenses/gross monthly income Back-End Ratio Caps ✔✔36% for conventional loans and renters, 43% for FHA, 45% for Energy Efficiency Mortgage loan Four C's of Credit ✔✔Character, Capacity, Capital, Collateral Monthly housing expenses - PITIA ✔✔Principal, Interest, Taxes, Insurance, Association dues and special assessments Interest only Terms ✔✔Only pay interest in monthly payments - good for fluctuating income, but can make payments on principal when they can FHA loans good for: ✔✔those who do not qualify for conventional because of flawed credit history, bankruptcy, high debt-to-income ratios, or limited funds for down payment & closing costs USDA loans ✔✔United States Department of Agriculture - Rural development program USDA guaranteed loans are for ✔✔those who make less than 115% of Area Median Income, or AMI, no funds for down payment, and without adequate housing. USDA Direct loans are for ✔✔those who make less than 80% of AMI, unable to obtain other financing but have reasonable credit... loans can go for up to 33 or 38 years Mortgage Insurance ✔✔Protects lender if you stop making payments, Required if down payment is less than 20% of home value 2nd Mortgage - "Piggy back" ✔✔assures 1st mortgage is only 80% of sales price -- will mean higher interest rates and more fees Loan to Value Ratio -- LTV Ratio ✔✔% calculated by dividing the amount of outstanding loan amount by the value of home Lender must terminate PMI when LTV ratio reaches: ✔✔78% OR at midpoint of loan, i.e. 15 years of 30 year mortgage Adjustable Rate Mortgage ✔✔30 year, interest rate set for 1st 5 years then adjusts annually ARM good for: ✔✔Those who have $ for down payment, wants lower interest rate for few years and may not own home for more than 5 years [Show More]

Last updated: 2 years ago

Preview 1 out of 20 pages

Buy Now

Instant download

We Accept: