The percentage ratios used as guidelines in the qualification of an applicant's income by HUD/FHA are based on the applicant's
A) effective income not reduced by taxes
B) net effective income after deduction of both income and social security taxes
C) net effective income reduced only by withholding tax
D) net effective income reduced only by social security taxes

Question

Quizplus · Accepted Answer

HUD/FHA guidelines are based on the applicant's effective income, which is the gross income minus taxes. The guidelines do not take into account specific deductions such as income or social security taxes, so B, C, and D are incorrect.

The Percentage Ratios Used as Guidelines in the Qualification of an Applicant's