Maureen Townson of Enact: Keeping Homebuyer Education Current and Relevant for Borrowers
Maureen Townson is an Account Manager with Enact Mortgage Insurance, where she is responsible for managing account relationships with banks, mortgage bankers and credit unions. In addition, she also leads training sessions in partnership with Enact’s Customer Education team. The statements in this article are solely her opinions and do not necessarily reflect the views of Enact or its management.
April is Financial Literacy Month. As mortgage professionals, we have the opportunity – and responsibility – to educate borrowers about homeownership from beginning the homebuying process to discussing what happens after the loan closes.
This month, take inventory of your homebuyer education program and evaluate your approach. Does it have all the right details? Is it relevant to the current state of the market? Is it accessible to your current and prospective borrowers? Answering these questions can help you ensure that your organization’s homebuyer education is as impactful as it can be.
Ultimately, the education you provide to homebuyers should be seen as any other offering or product you have, not an “extra.”
What Makes a Good Program
To be truly educational and valuable, there are many essential topics that your homebuyer education course must cover:
What to Know Before Buying: Most borrowers will come with some understanding of their budget, but not everyone will have a full understanding of all the expenses associated with the homebuying process. Neither will every borrower understand credit, know their score, or know how their score impacts their rates. Does your course cover budgets, homebuying costs, and credit?
Industry Vocabulary: The mortgage industry tends to rely heavily on technical terms and abbreviations. For the average consumer, it can feel like a completely different language. Does your course explain them?
Different Products: Lenders, especially today, are broadening their product sets to cater to different needs in the market. Do your borrowers or prospects know what you offer or what’s available to them?
Parties Involved: Between realtors, appraisers, lenders, etc. there are numerous parties involved in the homebuying process. Does your course cover their roles and what to expect?
These are just a few of the topics your course should cover. Take the time to take inventory and make sure your educational resources have all the basics covered.
How to Keep it Current
Once you’ve determined what your course covers, how do you keep it relevant? Our industry changes quickly and often – do your educational resources keep up? Even if your course is only a year or two old, homebuying has changed drastically during that time. Be mindful of:
New or Increasingly Popular Terms: Some of the terms you frequently use will change over time. For example, something like seller concessions may not have been very important to cover when you created your homebuyer resources, but, in a buyer’s market, will come up more and more. Be mindful of new terms you’re using or ones you’ve had to dust off recently.
Popular Products: Which products are you seeing more of? For example, adjustable-rate mortgages (ARMs) and buydowns have gained popularity as interest rates have risen. Three years ago, you may not have felt a need to cover these products, but, as borrowers seek lower interest rates, they need a full understanding of what an ARM entails to choose the best product for their situation.
Tips for Success in the Current Market: Strategies for success in the homebuying process also can change with the market. Make sure your course explains how the process can be affected by whether it is currently a seller’s market or a buyer’s market.
You should be able to adjust your resources based on these factors so that your material stays fresh and is relevant and helpful to your borrowers. It’s not necessary to reinvent the wheel every time – small tweaks can go a long way in showing you are in touch with what the market is doing and what your borrower’s needs are.
How to Be Accessible
Even the greatest resources are ultimately ineffective if they are not reaching the right people. Your homebuyer education may be for existing customers and is a way for you to stay top of mind with them and demonstrate your expertise on industry trends, but it could also be a tool to help prospective homebuyers understand what they need to do to get ready to buy a home.
Regardless of who you’re working with, one size does not fit all, so it’s critical to know your audience. Ask yourself what format works best for them. Seminars may be great for those who want to ask a lot of questions and take a deep dive face-to-face, but others may want to access education on their own time or from anywhere. According to a HUD study, buyers that were offered education courses in a remote setting were more likely to complete the training versus those who were offered an in-person format. Given a choice between the two, about three fourths of participants chose the remote option.
Additionally, you may have some prospective homeowners that need content in different languages. According to the Census Bureau, nearly 68 million people speak a language other than English at home. Are you able to adapt your resources into a language your borrowers more easily understand or are more comfortable with?
These are just a few of the reasons you need to be mindful of who you serve. Ask yourself what cultures or languages are represented in the community you serve and which generations you reach. Knowing these demographic factors will help you make more informed decisions about how to reach your borrowers.
Once, you know who you’re working with, find out where they are. Each generation or culture will have their own go-to sources for information. For example, Forbes recently reported that TikTok has been instrumental in financial literacy among Gen Z, women and some marginalized communities. However, you may work primarily with borrowers who prefer to consume information in a different format which may be longer-form or outside of social media, for example.
The bottom line is, you need to keep your homebuyer education relevant if you want everyone to get the most out of it. Keep it timely and in the right channels in order to reach the maximum number of borrowers with this important information. Taking the time to effectively educate your buyers helps ensure their success – and yours.
(Views expressed in this article do not necessarily reflect policy of the Mortgage Bankers Association, nor do they connote an MBA endorsement of a specific company, product or service. MBA NewsLink welcomes your submissions. Inquiries can be sent to Mike Sorohan, editor, at msorohan@mba.org; or Michael Tucker, editorial manager, at mtucker@mba.org.)
