Renters making the leap to homeownership need two distinct types of help: pre-purchase assistance, which explains to people the new responsibilities they’re taking on, and post-purchase counseling for those at risk of losing their home. The National Urban League helps purchases in both phases. We have long championed the key themes of “preparation” and “readiness” in helping clients make the leap from renting to the responsibilities and realities of ownership. Urban League pre-purchase counseling programs, for example, prepare and qualify prospective homeowners—particularly those who have low income, inadequate savings, or impaired credit histories—for the financial responsibility of a mortgage. Most Urban League affordable housing programs also include a compulsory financial literacy component addressing debt management, budgeting, and techniques to maximize saving. Community organizations like ours provide training to develop ‘’bankable’’ borrowers who can qualify for a mortgage and appropriately manage their debt. These programs typically provide homebuyer training, both before and after purchase, to more than 50,000 individuals each year.

An important part of the pre-purchase counseling process is collaborating with potential borrowers to remove barriers to homeownership, mainly affordability and credit problems. We work with potential homeowners to build or repair credit. Others may offer financial assistance to supplement down payments, closing costs, or monthly payments. Without such assistance the barriers to homeownership may be insurmountable for many low-income individuals.

Post-purchase education and counseling can stabilize homeownership in underserved communities. Post-purchase education and counseling refers to a range of services—from instruction on home maintenance, budgeting, and foreclosure prevention, to crisis intervention for delinquent borrowers, or counseling to prevent or assist victims of predatory lending. Intensive, one-on-one default and delinquency counseling reduces the incidence of default and foreclosure among low-income households. From 2018 to 2020, Urban League programs were credited with preventing more than 6,000 foreclosures.

Urban League counselors collaborate closely with borrowers to help them understand their options and function as intermediaries in negotiating between borrowers and servicers to put the best workout in place. Moreover, if a workout is not feasible or unsuccessful these agencies ease the homeowner’s transition to other affordable housing options.

Read the full article about counseling programs by Cy Richardson at Democracy Journal.