Anyone who is interested in buying a home now is likely to discover these are tough times. For many prospective homebuyers trying to navigate their way through the aftermaths of the mortgage crisis of 2008, the health and financial crisis resulting from the pandemic, high interest rates, limited affordable housing inventory, and inflation, finding the right home to buy affordably is tough. The best thing for a first-time homebuyer to do is take a deep breath, get the lay of the land, and get help from a trusted resource: a HUD-certified, nonprofit counselor.
WHAT IS A HOUSING COUNSELOR?
Housing counselors can assist in the areas of buying, preventing foreclosure, and refinancing homes. A HUD-certified, nonprofit housing counselor is specially trained to help consumers assess their financial situation, evaluate options if they are having trouble paying their mortgage loan, and develop a plan to get them help with their mortgage and/or other payments. Their nonprofit status indicates their primary focus is to help the individual or family.
WHY A HUD-CERTIFIED, NONPROFIT HOUSING COUNSELOR?
Buying a home is a complex undertaking with a lot of moving parts, terminology, and participants the average person is not familiar with. No shame in that. For that reason, the average person would be well served to enlist the assistance of a subject matter expert—someone who could guide them through the process, act as their coach, help them to achieve the best outcomes possible given their specific and unique financial situation. Sometimes, more often than you think, people are turned down when they apply for a mortgage loan. What many fail to realize is there is no shame in being denied. All that denial means is there is something in the applicant’s financial profile the lender feels should be addressed before extending their approval for a mortgage loan.
Sometimes a responsible “No” is a good thing. It allows the applicant to shore up their savings, credit, and/or downpayment so that, if an unforeseen financial crisis occurs, they can more effectively weather the storm.
There are many reasons why working with a HUD-certified housing counselor makes sense. A certified nonprofit housing counselor can:
- Give you access to a certified homebuying expert who can coach you through the homebuying process and help you avoid common mistakes that cost you money.
- Help reduce the stress of what is commonly a very stressful process.
- Allow you to improve your odds of being approved for an affordable mortgage loan.
- Connect you with experienced, certified, subject matter experts who will create a customized action plan tailored to your specific needs to get you to “mortgage-ready.”
- Help determine whether the applicant can qualify for Down Payment Assistance (DPA) to reduce the out-of-pocket expense of a downpayment.
- Connect you with resources to support homeownership beyond buying a home, to include the future possibility of refinancing a mortgage, home equity loans, a reverse mortgage, foreclosure prevention, and more.
WHAT SHOULD YOU EXPECT?
If you decide to explore the opportunity of working with a HUD-certified housing counselor, consider the following steps:
- Go to the National Foundation for Credit Counseling’s website, nfcc.org, or HUD housing counselor locator sites to identify a certified counselor (sites listed below).
- Connect with a HUD-certified housing counselor for a confidential consultation.
- Participate in a one-on-one review of your financial goals and budget.
- Develop with the counselor a personalized financial action plan.
- Schedule regular follow-up meetings with the counselor to monitor, manage, and track progress until you achieve mortgage readiness.
HOW CAN YOU FIND A HUD-CERTIFIED, NONPROFIT COUNSELOR?
Do not be fooled! There are a lot of imitators out there. If you are interested in buying a home and want to enlist the assistance of a HUD-certified housing counselor, go to:
Links:
or call:
- NFCC: (844) 865-3028
- HUD: 800-569-4287 or 202-708-1455
SOME THINGS TO CONSIDER:
There are a lot of myths and misinformation being spread through our communities. One example is that, “They say black folk don’t do counseling.” Really? Before anyone takes this message to heart, here are a few questions to consider:
- Who are “they?”
- What makes “them” the experts?
- What gives them the right to dictate which resources you should use to improve your financial outcomes?
If your tooth was hurting, you would go to a dentist. If your car was not working, you would go to a mechanic. If you had legal issues and you needed help, you would go to a lawyer. The common thread here is, when there is a problem, it is always a good practice to enlist the aid of a subject matter expert. The same is true when dealing with financial matters and creating better outcomes.
In many ways, managing your financial life is like mastering a video game—a game that, to win, you need to know the rules. What many people do not know is that there are resources available to teach you the rules of the game. Moreover, there are people who are dedicated to serving as your personal coach to help you succeed in achieving your goals.
The National Foundation for Credit Counseling (NFCC) is committed to helping you build a better financial future. Owning a home has proven to be a key cornerstone to wealth building. To learn more, go to nfcc.org.