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Opportunities to Enhance Pre-Purchase Homeownership Education
Wednesday, April 5, 2017 6:15 AM

New research from Fannie Mae

For consumers looking to buy a home, pre-purchase homeownership education should help them to make informed decisions. And ideally, better-informed decisions would result in better outcomes, including more sustainable homeownership and reduced risk of mortgage default.

However, research results about the outcomes and effectiveness of pre-purchase homeownership education vary considerably. This prompted our Economic & Strategic Research (ESR) Group to study current homeownership education practices and experiences within the mortgage industry, and to identify gaps and opportunities to optimize participation.

In interviews with lower-income first-time homebuyers, loan officers, and real estate agents, all agree pre-purchase homeownership education is a good idea and empowers consumers, but awareness is low. Here's what our ESR Group learned.

Key findings:

  • Almost no consumers, and few professionals, know what's actually available.
  • Consumers are reluctant to spend extra time on education during an already stressful and time-consuming process.
  • Respondents say education should happen earlier in the process.
  • Homebuyers value personal interaction and a hands-on approach to learning.

Opportunities:

  • Building on the shared belief that homeownership education is valuable, lenders and real estate agents can collaborate to help promote education.
  • They can do this by:
    • Encouraging early participation—around the time of pre-qualification
    • Offering incentives
  • And education providers can enhance current offerings by:
    • Simplifying, centralizing, and clarifying education options
    • Personalizing training, and providing a coach

Learn more:
Learn more about the study in the Fannie Mae Perspectives blog and check out the full study results