We Keep Debating the Price of the House. We Should Be Building the Road to It.
Helene Raynaud is senior vice president of business development with Money Management International
Affordability Is Only Part of the Equation
For the past several years, the mortgage industry has focused intensely on affordability, and rightly so. Rising home prices, elevated interest rates, limited inventory, and persistent economic uncertainty have made homeownership more difficult to achieve for millions of Americans.
But affordability is only part of the equation. Every day, nonprofit housing counselors work with consumers who aren’t being held back solely by the cost of a home. They’re held back by something less visible: they simply aren’t mortgage ready, yet. They may have manageable debt but no strategy for improving their debt-to-income ratio. They may qualify for down payment assistance but have no idea the programs exist. They may have sufficient income but limited savings, inconsistent credit history, or financial setbacks that make them appear less prepared than they truly are.
These are solvable challenges. But they rarely resolve themselves. If we want to expand sustainable homeownership, we need to spend as much time building the road to homeownership as we do debating the price of the destination.
The numbers suggest that road has become increasingly important. The U.S. homeownership rate has remained relatively unchanged over the past decade, while the National Association of Realtors reports that first-time buyers now represent the smallest share of home purchases in more than 40 years.
This isn’t simply an affordability story. It’s increasingly a readiness story.
Mortgage Readiness Is Becoming a Journey, not a Milestone
Fortunately, the industry is beginning to recognize this shift. Fannie Mae now considers positive rental payment history in certain underwriting decisions. Freddie Mac has expanded the use of cash-flow assessments. Lenders are increasingly incorporating broader measures of financial behavior alongside traditional credit metrics. These changes acknowledge an important reality: financial readiness cannot always be captured by a credit score alone.
Research reinforces that direction. The Urban Institute estimates that nearly one in five denied mortgage applicants could have qualified had positive rental payment history been considered. Meanwhile, the Federal Reserve continues to find that many households lack the financial resilience needed to absorb even modest unexpected expenses. Meeting an underwriting threshold on the day of application is no longer enough if a single financial setback can derail the journey.
From Housing Counseling to Financial Navigation
Historically, housing counseling focused primarily on education – helping consumers understand budgeting, credit, and the mortgage process. Those services remain incredibly important. But today’s consumers often need something more: they need navigation.
Mortgage readiness has become a series of interconnected financial decisions made over months, or even years. Which debts should be paid down first? Should a consumer enroll in a debt management plan before applying for a mortgage? Which of the thousands of available down payment assistance programs best fit their circumstances? Would waiting six months result in a significantly stronger mortgage profile? These are not one-time educational questions. They require personalized guidance that evolves as a family’s financial situation changes.
Housing counseling has always helped people buy homes. Financial navigation helps people become homeowners. That evolution creates a tremendous opportunity for nonprofit organizations.
For decades, nonprofits have earned trust by helping families make informed financial decisions without being driven by product sales or commissions. We already help consumers navigate budgeting, debt repayment, credit improvement, foreclosure prevention, and homeownership education. Increasingly, those services can be connected into a continuous pathway that helps consumers move from financial uncertainty to sustainable homeownership.
Technology Should Strengthen, Not Replace, Human Guidance
Technology has an important role to play in making that vision possible. Artificial intelligence is generating enormous discussion across every industry, including housing finance. In my view, its greatest opportunity is not replacing housing counselors, but extending their reach.
Used responsibly, AI can help identify barriers earlier, personalize action plans, surface relevant assistance programs, automate administrative tasks, and prompt timely follow-up, allowing counselors to spend more time where they create the greatest value: helping people make informed financial decisions during life’s most important moments.
At MMI, we’re exploring exactly that through our newly launched Financial Wellbeing AI Lab, bringing together leaders from financial services, behavioral science, technology, philanthropy, and nonprofit organizations to better understand how AI can responsibly strengthen, not replace, the human relationship at the heart of financial counseling. The goal isn’t to automate counseling. It’s to make trusted guidance available to more people, earlier in their financial journey.
Why This Matters for the Mortgage Industry
This evolution should matter to lenders as well. Borrowers who receive guidance before submitting an application are often better positioned to qualify, make effective use of affordable lending programs, and sustain successful homeownership over the long term. In a market where purchase volume remains constrained, helping more consumers become mortgage ready expands tomorrow’s pipeline while supporting better borrower outcomes. That creates value across the housing ecosystem for consumers, lenders, servicers, housing finance agencies, and nonprofit organizations alike.
Building Better Roads to Homeownership
For decades, nonprofit housing counseling has helped families achieve sustainable homeownership. That mission hasn’t changed.
What has changed is the complexity of the journey. Today’s consumers need more than information. They need someone to help them navigate an increasingly complicated financial landscape with confidence, clarity, and trusted guidance.
If we want to expand sustainable homeownership over the next decade, we can’t focus solely on the price of the house. We also have to invest in the road that gets people there.
(Views expressed in this article do not necessarily reflect policies of the Mortgage Bankers Association, nor do they connote an MBA endorsement of a specific company, product or service. MBA NewsLink welcomes submissions from member firms. Inquiries can be sent to Editor Michael Tucker or Editorial Manager Anneliese Mahoney.)
