Demand for housing counselors on the rise

Purchasing a home is undoubtedly one of the largest investments an individual will make in his or her lifetime, but many are confused or overwhelmed by the mortgage process. There are several components involved in obtaining a home loan and missteps can lead to higher interest rates, delays or being denied financing altogether. In an effort to help them navigate the mortgage process more easily and avoid mistakes, more consumers are enrolling in housing counseling or seeking the assistance of a professional.

MortgageKeeper Referral Services recently released the findings of its’ Homeowner Needs Status Report, which reveal a higher demand for housing counselors and guidance. During the first quarter of 2013 alone, more than 300,000 home shoppers requested some level of local assistance, a 41 percent increase from the same period in 2012.

While the housing crisis is clearly easing, people still need help," said Rochelle Nawrocki Gorey, president of MortgageKeeper Referral Services. "We are grateful for a stronger housing market, but many homeowners are still underemployed, facing negative equity, or need assistance in securing a smooth transition to rental housing.

Housing counseling may benefit home loan seekers

One of the most common mistakes a potential buyer can make is failing to plan ahead and understand the home loan process before submitting an application. An ill-informed consumer may lack pertinent knowledge about improving their credit scores before meeting with a lender, lowering or eliminating credit card debt, saving for a down payment or choosing the right type of mortgage loan for their unique financial condition. As there are many players involved in the mortgage process – ranging from brokers, lenders, inspectors, attorneys and appraisers – it’s crucial that buyers be aware of their rights and responsibilities.

Although many lenders are loosening the reins on credit, eligibility guidelines and credit and down payment requirements continue to be strict. In the years following the recession, many would-be buyers faced financial setbacks that may have hindered their savings and led to weaker credit ratings. As a result, they may face challenges obtaining a loan or choose a product that forces them to overextend their finances.

To avoid these occurrences, enrolling in housing counseling may be a cost-effective alternative that not only educates individuals on what to expect but also helps buyers make financial behavioral changes that can have long-lasting benefits. Professionals can provide home buyers with customized solutions to overcoming weaknesses in their loan applications and realize their dreams of homeownership.