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You may be ready to stop paying rent, but are you ready to buy a house? Between understanding how a mortgage works and budgeting to cover housing costs, the path to owning a home can have a steep learning curve. That’s where home buyers’ education courses appear. Many state home buyer assistance programs and some mortgage lenders require borrowers to take home-person education courses, especially if they are first-time home buyers.
What is the HomeBuyer Education course?
The HomeBuyer Education course is a class that can be accepted online or in person, giving you a better understanding of what is involved in discovering, raising funds and owning your home. In many cases, they are not options. Your mortgage lender may need you to complete the course, or you may need to take it.
“This class explains the home buying process, what you need from borrowers to get approved for a mortgage loan, and the benefits and challenges of homeownership and mortgage and lending terms,” said Wil Hendrix-Griffin, senior VP of Affordable Lending at PNC Bank in the Chicago area.
According to Hendrix-Griffin, these may be provided on a pass/fail basis, and buyers will typically receive a certificate upon completion. Other courses include grading systems, such as the HomeBuyer Education Class, provided by Take Charge America, a Phoenix-based non-profit credit counseling agency.
“In our course, participants carefully review content and their knowledge is tested regularly through a set of quizzes,” says Jeremy Wine, former manager of professional counseling services and partnerships, which provide classes to buyers in all 50 states. “People who receive a cumulative score of 70% or more will pass and receive a certificate of completion.”
What do you learn in the HomeBuyer Education class?
Your first-time HomeBuyer class aims to ensure you are ready for your commitment by helping you learn the entire process of buying and owning a home.
Learn about the various steps in the home buying process, including:
However, each HomeBuyer Education class is different and the width of material covered will vary depending on the organization that provides it. There is also the difference between attending a class in person and taking one online.
“The best courses are in-class classes that allow for substantial interactions with both in-class and with instructors,” says Tony Julianel, CEO of Atlas Real Estate in Denver. “Ideally, classes should provide time to work through a variety of scenarios, including how to develop their household finances and pay for large repairs if necessary.”
Why should you take your first home buyer education course?
Buying a home is a big step and the process is overwhelming. When you start thinking about it, you will probably find yourself thinking a lot of questions. For example, what are fixed-rate mortgages and adjustable mortgages?
Your first-time home buyer education course will help you address some of these questions and offer to submit an offer to your home and apply for a mortgage. Additionally, classes could be a more affordable mortgage requirement.
These benefits (as part of your first-time buyer loan program) can save you money on your mortgage and reduce the overall cost of your homeownership.
How to Find HomeBuyer Education Courses
The U.S. Housing and Urban Development Agency (HUD) lists approved homeowner classes, making it a great place to get started. You can also consult with a real estate agent for help. If you are planning to apply for state-sponsored assistance, you should look at the state housing authority website and ask a lender to help you find an approved course.
Comparing options reveals two main types of programs.
- on demand: Online Homeowner Classes allow you to access source materials and take the necessary tests if they are convenient. It also offers the same information quality as face-to-face classes.
- local: Many real estate agents and lenders offer first-time buyer certification classes. That said, if you are considering qualifying for a grant or loan, you should make sure your class meets the lender’s requirements.
