NACA Pre-Purchase Practice Exam

These questions are part of the practice quiz. Start practicing

• What is the best method of payment for rent according to the guidelines?
• Which statement best defines income stability for a Wage Earner?
• Income from a second job can be included for qualification if the job has been held for how long?
• How is the amount a member pays in rent used in the qualification assessment?
• Which type of home is specifically ineligible for financing under NACA?
• In a Mixed Use property, what is the minimum percentage required for the residential component?
• Which of the following is a barrier to homeownership?
• What must the purchase contract specify for mixed-use properties?
• Which stage in the intake process is primarily concerned with planning for future steps?
• What is critical to ensuring mortgage payments can be determined effectively?
• How does depreciation affect the net profit when calculating qualifying income?
• What type of expenses do one-time expenses typically include?
• Which of the following is correct regarding documentation of late payments for co-signed accounts?
• How long must a member stay in their home to break even if they utilized the NACA-Buy Down?
• How is the market rent calculated for vacant units?
• Which of the following ratios is NOT used by NACA for properties purchased through their program?
• What distinguishes a VIP Member within NACA?
• What is the minimum duration of continuance required for Child Support to qualify as income?
• If three years have passed since a Member closed on their NACA mortgage, what is one requirement for them to purchase through NACA again?
• Your Member wants to exclude a lease payment from her DTI calculation after reducing the balance. What must the balance be brought down to?
• In NACA, how are housing expenses treated for qualification purposes?
• What additional documentation must self-employed members provide beyond tax returns?
• What is the reserve requirement for purchasing a four-family duplex?
• To qualify for NACA, how far back must members demonstrate a history of responsible financial behavior?
• Which roles are included in the Operations Department of NACA?
• What key items must always be included in a Member's Action Plan for follow-up or going to UW?
• Who receives the Housing Choice Voucher (HCV) payment when a Member obtains a NACA Mortgage?
• Which action does NOT contribute to increasing Payment Shock Savings (PSS) bank account balances?
• Which states are co-ops available in?
• In terms of housing payment percentage, what qualifies as a significant compensating factor under NACA?
• If a member lives with family and contributes $500 per month, how many months of proof of rent payment must they provide?
• Which mortgage term is primarily used within the NACA services?
• What is Shayla's qualifying income based on her 1099 and year-to-date paystub?
• The 15-year amortization on a 20-year term mortgage is associated with which NACA program?
• What is the requirement for mixed-use properties regarding occupancy?
• NACA's maximum CLTV amounts can exceed 100% for purchases and for rehabs under what condition?
• When a member adds 6 months of PITI to their loan under special circumstances, what happens to their interest rate?
• When determining the income needed for desired PITI, what percentage is used for DTI calculation?
• What is the minimum number of counseling sessions required per week by NACA?
• What does an LTV ratio of 100% mean in mortgage lending?
• What is the calculation used for determining Gross Monthly Income (GMI) based on hourly pay?
• What is the minimum duration for bank statements required for self-employed members?
• What is the amount of the NACA soft lien on properties purchased through their program?
• What is included in the closing expenses for a Member?
• What does LTV stand for in the context of mortgage lending?
• What is the impact of insufficient funds on the member's qualification?
• What is the effect of a completed condo/co-op questionnaire on a bank application?
• How long does a Housing Choice Voucher (HCV) typically pay a NACA mortgage?
• What is the qualifying income after rounding up from calculations provided?
• What is a Tax Return Transcript primarily used for?
• What is the minimum number of closed loans required per month by a NACA counselor?
• Which tax schedule reports the share of income for each shareholder/partner in a business?
• What is required to determine maximum allowable monthly debts?
• What activity is required from NACA Members each year?
• Which of the following is considered an anti-money laundering red flag?
• What is the action needed to delete an item from an Action Plan?
• Which department manages Training and Development?
• What percentage is typically used for the DTI calculation for self-employed members?
• Which costs are included in the MRF calculation?
• Which term did NACA coin in 1990?
• What are the acceptable income calculation options for self-employed individuals?
• Which of the following is a feature of NACA's Purchase Program?
• What is the earliest a member can qualify for NACA after a Chapter 13 Bankruptcy discharge?
• Which of the following is true regarding the use of multiple contracting 1099 employers when evaluating qualifications?
• What is one of the most significant challenges to achieving homeownership?
• Which of the following property types is NOT eligible for a NACA Mortgage?
• What is one of NACA's core principles?
• At Credit Access, which option can a member choose?
• What is the maximum Debt to Income Ratio (DTI) for standard members in the NACA program?
• What do lenders assess using the Combined Loan to Value (CLTV) ratio?
• What is a requirement for members regarding landlord training for multi-family properties?
• What is the condition in which depreciation is added back in self-employment income calculations?
• What type of training does the NEJAC provide?
• What type of information is found in an Account Transcript?
• What must a property do for a member to be eligible for a rehab loan?
• What does CLTV represent?
• What is an example of a one-time expense?
• How is the interest rate affected by a buy-down of 1.5% of the loan amount?
• Which document is NOT required for bankruptcy that has been dismissed?
• What is a requirement for condo properties concerning owner-occupancy?
• What does the Back End Ratio calculation include?
• Are members allowed to sell or refinance their NACA-purchased properties at any time?
• Can the Housing Ratio exceed 33% under certain conditions in the NACA program?
• What is the minimum amount of the MRF that must be liquid at qualification?
• What qualifies a Member as a Priority Member?
• What action is needed if a member has multiple 1099 employers and also files expenses?
• Who responds to Member Services inquiries?
• Are home-based business losses considered impactful for a Member's income qualification?
• What does NACA stand for?
• What must be requested before a bank application for a Condo/Co-op property?
• What is a key responsibility of the HomeSave Department?
• How much total money has been committed to NACA's Best in America Mortgage?
• What is the formula for calculating the maximum PITI based on the housing ratio?
• What is the maximum percentage of depreciation that can be added back for income calculations?
• Which of the following requirements must be met for co-op properties under NACA?
• Who is considered a Borrowing Member within NACA?
• For a wage earner living with family or friends, how long is the minimum PSS duration?
• How is a non-borrowing household member's debt treated when calculating overall ratios?
• What should be done if a self-employed member has variable income?
• Which document is required to verify the member's tax return submission?
• Which service is NOT part of the NACA Team?
• What is a benefit of the interest rate buy-down for the 30yr and 20yr mortgage?
• For self-employed members, what must be documented as part of the income verification process?
• Which bucket do you assess when verifying a member's rent payment history?
• What must a member do to initiate a construction loan before permanent financing?
• If a member has lived in the property and has fulfilled all other stipulations, what can they do after three years with their NACA mortgage?
• How many years of tax returns are required for self-employed individuals applying for a mortgage?
• Which of the following items is typically not included in the closing costs paid by the lender?
• Who is eligible to provide gift funds for a member?
• What is a necessary component for all self-employed member submissions?
• How much is the seller's contribution limited to regarding the contracted sales price?
• Which of the following is a requirement for NACA membership?
• What components are included in Tier 1 of the Alternative Credit Tiers?
• What happens if a member's PITI is greater than their current rent?
• What is the primary factor for determining if a 30-year mortgage is suitable for a member?
• What kind of members are required to provide 12 months of bank statements?
• What is the PSS requirement for borrowing Members seeking a mortgage payment higher than their current rental status?
• Which of the following describes how to handle variable income calculations?
• By what percentage can non-taxable income be grossed up if housing expenses are more than 33% of income?
• What must a member provide for prior years' tax debt that has not become a lien?
• What must VIP Members maintain to keep their status?
• What document verification is required for someone seeking exceptions in Housing Ratio and DTI limits?
• What is NOT included in Tier 2 of the Alternative Credit Tiers?
• Which department works with homeowners in financial distress?
• What is the bank statement requirement for a member living with family?
• What form must be signed by the member to certify cash flow analysis for self-employment?
• Which of the following documents is used to verify an amendment (1040X) was filed by the member?
• Which of the following statements is true regarding self-employment documentation?
• The Counselor can send a copy of the Member-authorized Rental Verification by all of the following means except:
• Do all self-employed members need to provide 12 months of bank statements?
• When are 12 months of bank statements specifically required for a 1099 Member?
• In exceptional circumstances, what is the maximum Debt Ratio that can be accepted by NACA?
• What is the first step a member must take to qualify for construction financing through NACA?
• For a 1099 employee, what is essential to estimate qualifying income accurately?
• What do HAND Relationship Coordinators focus on?
• What is a necessary condition for current or previous homeowners regarding past mortgage payments?
• What is a requirement for manufactured or modular homes under NACA?
• Who is required to participate in NACA's Purchase Counseling?
• For medical collection accounts, under what condition must they be paid?
• What is the purpose of the Family Self-Sufficiency (FSS) program?
• Which of the following is NOT an acceptable form of rental payment history verification?
• What is the requirement for non-medical collections accounts within the past two years and an aggregate balance greater than $2000?
• According to the Multi-Family Properties Affordability Calculation Rule, how is a Member's income treated?
• Which factor does NOT affect a member’s eligibility to purchase another property through NACA after closing on their previous mortgage?
• What two documents must be signed by all NACA Members?
• What percentage of income is used to reduce PITI for vacant units according to the affordability calculation rule?
• What does NACA's team include?
• When calculating income for a Cash For Services Member, what should be used as qualifying income?
• If a member pays down their auto lease balance, which amount qualifies for exclusion from DTI calculations?
• Approximately what fraction of counseling does NACA provide nationwide?
• How many months of on-time payments are required for a payment plan to be valid for tax debt?
• Is there a requirement for members with foreclosures to show prior on-time payment history?
• Which of the following is a condition for structuring a member's loan as 1099?
• What percentage of total units can be used for business in mixed-use properties?
• What is required to process a member as a 1099 according to the rules?
• How many stages are included in the intake sessions?
• What must happen for a NACA Member to retain their mortgage?
• When can a member qualify for NACA after a Chapter 7 Bankruptcy discharge?
• Which of the following must be removed from a manufactured home according to NACA requirements?
• Which element is part of the calculation for tenant portion?
• In terms of MRF, which of the following is NOT included?
• Who qualifies as a Household Member in the NACA program?
• Can a member obtain credit access approval while waiting for the Condo/Co-op questionnaire?
• What surplus amount does a W2 member paying a landlord need?
• What is true regarding accounts charged-off within the last 24 months?
• What is the correct calculation for semi-monthly pay?
• If a Member is buying the house they are renting, which is acceptable as proof of on-time rental payments?
• What is the maximum age a child can be for their support to be considered qualifying income?
• What effect do lump sum withdrawals generally have on the savings pattern?
• What is the calculation for the Debt-to-Income (DTI) ratio?
• To qualify as self-employed, how long must the individual have worked in the same industry?
• What is the maximum Housing Ratio allowed under NACA guidelines?
• What can a Member do at Credit Access?
• What is the primary reason for including both last year’s tax return and YTD pay in self-employment calculation?
• If written into the guidelines, how are funds from a Non-Profit agency treated for closing costs?
• For how many months does NACA verify rental payment history?
• What does the Record of Account Transcript include?
• Who are considered Priority Members under the LMIB grant features?
• Which characteristic defines a Non-Priority Member?
• Which calculation is used to determine the qualifying income for a Corporate Member?
• How many members must a NACA counselor qualify each week?
• Is it true or false that seller contributions to a contract can exceed 10%?
• What is the requirement for self-employed members regarding documentation?
• Current and previous homeowners must demonstrate on-time payment history for a minimum of how long?
• What happens to the construction loan after the home is completed?
• What is the annual fee that every NACA member must pay?
• Why must a member's closing expenses include homeowner's insurance?
• In a self-employment income calculation using a Corporate method, what must be included alongside reported earnings?
• Is rent considered the baseline for determining the mortgage payment a member can afford?
• What does HOT-PHA stand for?
• Is it possible for someone to opt-out of NACA membership?
• What roles are part of the Mortgage Department?
• What is NOT part of NACA's Purchase Program?
• What do counselors first consider when evaluating alternative credit?
• What is NACA's maximum LTV for purchases?
• What is the tenant portion calculation based on the given median rent?
• Which mortgage has an interest rate reduction of 0.25% for every 1% of the loan amount?
• What type of financing is needed after obtaining a construction loan?
• Which members must show 24 months of on-time payments to be PH-qualified?
• Which role is part of the Real Estate Department (RED)?
• Which group is involved in economic justice issues as part of the Advocacy Department?
• What must a member decide if they opt for owner's title insurance at Credit Access?
• Which type of expense requires supporting documentation if it involves cash withdrawal?
• Members submitted for qualification should not have any overdrafts in how many days?
• Can a member exceed their desired PITI if their savings exceed closing costs and PSS?
• Is it true that the 15yr mortgage rate reduction is the same as the 20yr mortgage rate reduction?
• What does the At Your Service (AYS) Department assist with?
• Which type of member must have a 24-month on-time payment history to qualify for NACA?
• What is included in the final stages of intake sessions?
• What is the maximum percentage for a Buy-Down in NACA?
• What does the HomeSave Program help reduce?
• What document is NOT required for the Self-Employment Income Calculation for a Corporate Member?
• Is a Counselor advocacy cover letter required during NACA Qualification or Credit Access submission?
• How is bi-weekly pay calculated according to the formula?
• Which income calculation option provides a higher qualifying income when calculating for a Cash for Services Member?
• Which member does not require 24 months on-time payment history to be NACA qualified?
• Do you need to save additional funds for PSS if you want a mortgage greater than your current rent?
• When was NACA founded?
• How does the member need to have conducted their activity while holding a NACA mortgage?
• Which of the following documents is NOT acceptable for verifying self-employed income?
• In self-employment income calculation for a Cash for Services Member, what must be added to the income?
• What does Stage 10 Qualification involve?
• Which factor is NOT a consideration for determining a Member’s closing costs?
• Which of the following documents is essential for a member with 1099 contracting income?
• When reviewing bank statements, what does Heidi need to do if she has large withdrawals for unexpected expenses?
• What is one hardship reason acceptable for withdrawing from a 401k?
• For a wage earner paying rent to a third party, what is the minimum duration for PSS?
• What is the bank statement requirement for someone renting from a landlord or third party company?
• What is the formula for calculating weekly pay?
• Which stage focuses on the applicant's financial capabilities?
• What serves as the baseline for an affordable mortgage payment according to NACA?
• Who is considered an ex-household member?
• What does PSS stand for in the context of mortgage payments?
• What is the maximum PITI calculation for DTI ratio based on gross monthly income?
• Based on Cleophus' pension information, can he qualify for a 30-year mortgage?
• When are business losses from home-based businesses reported?
• What is a requirement for eligibility for a NACA Mortgage?
• What debt rule applies to all household members during NACA qualification?
• What is the role of the Rehab Specialists within the Home and Neighborhood Development Department?
• Which of the following is NOT classified as a Non-payroll deposit?
• What is considered the strongest compensating factor in qualifying for loans?
• What is the primary goal of NACA?
• Who has the authority to approve a Member's VIP status?
• Which document must be provided if a bankruptcy was discharged in the last 5 years?
• What lien does NACA take on the property?
• What benefit does a Non-Priority Member buying in a target area receive?
• Which entity is prohibited from giving gift funds for home purchases?
• What is the function of the Transcript that shows line items from the tax return document?
• What is included in the self-employment documentation required for a Cash for Services Member?
• What does NACA's HomeSave Program assist with?
• Which duration best describes the requirement for income stability for self-employed members?
• What is the requirement for withdrawing funds from a 401k for home purchase?
• What should a member do if their co-signer on an auto loan stops making payments?
• How long does a Counselor work with a Member?
• What is a function of the Real Estate Brokers within the Real Estate Department?
• If a self-employed individual's income is not being considered for the application, what might be needed?
• If a borrower has large withdrawals for unexpected expenses, what is required of them?
• Who is included in the Membership Assistance Program Department?
• What is the first step when calculating self-employment income for qualifying purposes?
• Which condition must be met to qualify a member with income from a second job?
• Which of the following is NOT a factor limiting mortgage payment?
• What does NACA allow as Non-payroll deposits?
• To qualify using income from a second job, how long must the member have worked that second job?
• Which of the following is an automatic benefit of the LMIB grant?
• HOT-PHA participants can save funds through which of the following?
• For a co-signed account with late payments, how will late payments affect the member's DTI ratio?
• Which property type can a buyer occupy as their principal residence in a mixed-use property?
• What is a requirement for members purchasing multi-family properties with NACA?
• For Self-Employed Members, the minimum duration for PSS is how long?
• What is one purpose for which funds from a Non-Profit agency can be used?
• What is the PSS for a member wanting a PITI equal to or less than their current rent?
• What is required for a member to qualify for exceptions to standard Housing Ratio and DTI limits?
• What is required for a member lacking credit history when applying for a loan?
• What constitutes the Housing Ratio Calculation?
• Who is responsible for the principal reduction at closing?
• What does the assessment of a member's rent payment history help determine?
• What is the maximum Combined Loan-to-Value (CLTV) percentage allowed for rehab loans?
• What action is taken when a discrepancy in identity is found?
• What type of fees does NACA not charge to its Members?
• Which of the following repayment plans is acceptable for student loan debt according to NACA guidelines?
• What type of members is subject to different PSS requirements based on their living situation?
• How can one determine the income needed for a desired PITI calculation?