Homebuyer Education and Counseling
The Minnesota Homeownership Center is a one-stop shop for Minnesotans seeking homebuyer education and counseling, as well as a centralized resource for nonprofit housing counseling agencies, Realtors and mortgage lenders throughout the state. By browsing course listings on the Homeownership Center website, families can find pre-purchase and post-purchase classes offered by numerous organizations statewide.
In addition to providing a convenient entry point for counseling services, the center has established a standardized homebuyer education curriculum and contracts with nonprofit partners to offer courses and subsequent individual counseling through trained and certified instructors. The center also coordinates marketing to help Minnesota’s families learn about the programs.
The center is a private nonprofit organization created and supported by community organizations and several state and local agencies, including the Minnesota Department of Commerce, Minnesota Housing Finance Agency, Minneapolis Community Development Agency, Minneapolis Housing Services, St. Paul Housing Information Center and St. Paul Planning and Economic Development Department. The state and local partner agencies each provide a portion of the center’s financial support.
The Alaska Housing Finance Corporation (AHFC) offers a homebuyer education program called HomeChoice. While homebuyer education in other states is often provided by private nonprofit organizations, Alaska’s immense size, expanses of uninhabited wilderness, cultural diversity and largely rural character led AHFC to conclude that developing a unique curriculum and providing instruction itself would help them ensure that all residents have consistent access to quality homeownership classes.
HomeChoice seminars last eight hours and are generally divided into two four-hour classes. They are open to all prospective homebuyers. Topics covered include mortgages, home inspections, title insurance, energy efficiency and money management. AHFC provides only classroom education; for individualized counseling, it refers families to a local nonprofit housing counseling agency.
Upon completion of the HomeChoice seminar, families receive a certificate valid for up to two years. The certificate qualifies families for a discount of up to $250 on the commitment fee for an AHFC loan. Completion of the HomeChoice seminar is a requirement for AHFC’s reduced-interest loan program and for the down payment assistance programs offered by AHFC partners.
In 2007, the Colorado Housing and Finance Authority (CHFA) introduced a homeownership education program. The online and in-person classes include a pre-purchase course and a money management class to serve families’ post-purchase needs. The online courses were designed to allow families in rural areas, as well as members of the armed forces, to conveniently access information on home buying, mortgages and money management.
The courses use a “confidence-based learning system” to evaluate participants’ understanding of the material. Participants in the online classes take a computer-generated, multiple-choice assessment that asks for both the answer and the participant’s confidence in the answer. Results of the assessment are scored using four categories: misinformed (i.e., confident but wrong), uninformed (i.e., not confident and wrong), doubts (i.e., not confident but correct), or mastery (i.e., confident and correct). Successful completion of the online course requires achieving a certain level of mastery of the material in the assessment.
In 2015, 9,048 households completed the CHFA homebuyer education classes.
The Wisconsin Housing and Economic Development Authority (WHEDA) uses partnerships to offer online homebuyer classes to provide consistent access to homebuyer education for families throughout the state. Through a partnership with NeighborWorks Green Bay, homebuyer classes are offered online for a low costs at eHome America.
Another low-cost online option is Framework Homeownership, created by Minnesota Homeownership Center and the Housing Partnership Network. If participants cannot pass the online class, they will receive additional assistance Minnesota Homeownership Center via phone.
Down Payment Assistance Programs
All families participating in down payment assistance or mortgage programs from the Maryland Department of Housing and Community Development must complete a homebuyer education program. The Department provides one-stop access to contact information for approved housing counseling agencies on its website.
The Department down payment assistance program offers no-interest, deferred loans (due upon sale or transfer of the property) up to $5,000, loans that are forgiven in increments over time up to $2,500, or grants supplied by partners of the Department. The Maryland Mortgage Program is a home loan program that offers a 30-year fixed rate loan at low rates. Both programs are administered at the local level by local housing agencies.
Visalia, Calif., offers two-percent interest, 30-year and deferred-payment second mortgages of up to $25,000 for first-time homebuyers earning up to 80 percent of AMI. All loan payments are deferred in the first 10 years, and then starting in year 11, homeowners must begin monthly loan payments.