Home Buyers Need More Counseling Than Workbooks by Lew Sichelman If you think open-book tests are a joke, wait 'til you get a load of what often passes under the guise of home-buyer education. In some cases, people totally unprepared for home ownership and frequently with only a rudimentary grasp of English are given a workbook to take home and read. Then, when they return, they are asked to sign an affidavit saying they read it and understood it. No hands-on instruction, no quiz, no nothing. In other cases, the uninitiated are given the workbook just a few hours before their loans are about to close and told to be sure to read it. "A lot of times," says Mark Goldhaber of G.E. Capital Mortgage Insurance Co. in Raleigh, an early proponent of home-buyer instruction, "it's more about getting the loan closed than it is about education." But that's about to change, thanks to the American Homeowner Education and Counseling Institute, a non-profit organization founded in 1997 and supported by all stakeholders in the buying process, from the people who sell real estate to the investors who ultimately fund the mortgage. To improve the quality and availability counseling services, AHECI is implementing a nationally recognized and accepted program for the professional certification of ownership educators and advisers. The institute won't dictate to providers what or how to teach. As long as they cover certain "baseline" information that conveys critical information, instructors and counselors will be free to tailor their classes to the individual needs of their communities or the clientele with which they are working. But it will teach individuals to become instructors; administer a series of exams that not only assess their knowledge, skills and abilities but also that of the various entities which provide classes and counseling, and revoke or suspend the certification of those who fail to meet the institute's standards. Because it is believed that education will allow low and moderate-income families to attain and sustain ownership, some form of instruction is a requirement of practically all affordable housing programs. But it's not just for working-class people or, for that matter, only first-time or first-generation buyers with absolutely no history of ownership in their families. "Everyone should be encouraged" to attend classes, says AHECI Chief Executive Karen Hill. "Because transactions and loan products are in a constant state of flux, people need to make sure they have up-to-date, accurate information. One of the things we hear all the time from owners who are refinancing is how much things have changed since they took out their first loan." Currently, there are more than 1,200 local non-profit groups which provide pre- and post-purchase education and counseling at little or not cost. But anyone can offer it, and practically everyone does real estate companies, lenders, even private individuals. And as a result, the quality of their instruction is all over the ball park. "As many entities as there are providing the service, there are that many different programs," says Hill. "You get some real highs and real lows." Some people are being "counseled into buying when they're really not prepared," says Minneapolis real estate consultant Missy Thompson. "Sometimes, it's housing any cost, and people get themselves in a bind." There are even wide inconsistencies among the programs offered through community-based non-profits. "Some are stellar, comprehensive programs," says Bridgette Haragan, director of home buyer education for Fannie Mae. "But because of a lack of funding, staff and/or training, others are only minimal." The worst offenders, though, are the private concerns which promise, for a fee, to get unsuspecting people into homes or instantaneously repair their credit. In some instances, wanna-be owners are lured to free seminars where they're told that for $500, they'll receive an instruction manual with everything they'll need to know to buy a house. But of course, the workbook has nothing in it that couldn't be found free somewhere else. And credit problems simply can't be fixed overnight. All this should change, though, once AHECI begins training instructors this fall. | 
