Helping Members Prepare for Homeownership

By: Opal Tomashevska, Director, Multicultural Business Strategy at TruStage

Co-author: Irma Yepez Klassen, Director, of Equitable Homeownership Strategy and Product Development at Mortgage Guaranty Insurance Corporation

Preparation is paramount for first-time homebuyers embarking on the journey of homeownership – especially for members in underserved populations and communities who may be the first in their families to purchase a home. Fortunately, credit unions are uniquely positioned to offer the extra attention and personal service that many first-time homebuyers require.

But before they can do that, credit unions must ensure all members can get to that point in the first place.

Safeguard Equal Access

Credit unions should understand the disparities that exist in homeownership and work to eliminate barriers for underserved populations and communities. The effects of discriminatory practices like redlining throughout the U.S. can still be felt in many communities, which is why equal access is so important for all members. Working toward equal access to homeownership is really an extension of the core mission of credit unions. Homeownership can be a key to building generational wealth. When families can begin building wealth through homeownership, communities wind up thriving due to the economic stimulation and investment from enriched community members.

There are resources to help credit unions ensure all their members receive the same opportunities in the pursuit of homeownership. For example, the Fair Housing Assistance Program, administered by the U.S. Department of Housing and Urban Development (HUD), partners with various agencies committed to promoting fair housing practices. You or your members who believe they’ve experienced housing discrimination can reach out to these agencies for assistance. A list of participating agencies is available on HUD’s official website.

Financial Readiness is Next

Beyond ensuring your members have equal access to homeownership, one of the most import ways credit unions can help members is to focus on advising them about credit and finances since diligent financial preparation lays the foundation for a successful and fulfilling experience. Make sure your loan officers are covering all the important bases:

• Establishing a budget
• Saving for a down payment
• Understanding credit
• Describing the mortgage process and associated costs, such as earnest money, appraisal costs, closing costs, real estate fees, etc.
• Explaining different types of mortgages and low-down-payment options
• Educating on the types of documentation that are needed.

Resources to Help you Educate your Members

Being prepared and understanding the homebuying process can help foster a sense of confidence in first-time homebuyers and makes the process less intimidating and more enjoyable for your members.

One way to help members prepare for every step of the homebuying process is to share valuable information with them:

• Readynest.com is Mortgage Guaranty Insurance Corporation’s (MGIC’s) consumer website. It’s chock full of first-time homebuyer resources, such as tips for navigating the process, first-person stories that inform and inspire, and tools like affordability calculators.
• National Industry Standards for Homeownership Education and Counseling (NISHEC) ensures quality and consistency in homeownership education and counseling services, serving as a benchmark for excellence. NISCHEC provides a searchable database of organizations that have adopted these standards. Individuals can identify trusted service providers committed to upholding ethical practices and delivering up-to-date information.

Preparing for the Wave of Future Homebuyers

With the U.S. population changing and people of color accounting for future growth, it’s important that credit unions build trust and a positive reputation through partnering with members on their homeownership journey. Together with their communities, credit unions can empower dreams and create enduring relationships, enriching each homeowner’s journey and reinforcing the foundation of a solid community.

To learn how you can ensure you’re helping your members to have equal access to homeownership, register for TruStage and MGIC’s upcoming webinar “Are YOU Prepared to Help Members Prepare for Homeownership?” on June 27 at 1:00 p.m. CT. Join us for this webinar to understand homeownership disparities and how you can help work to eliminate barriers in underserved populations and communities. Register Today!