Knowledge is power, especially for homeowners. In the complex world of ‘mortgage speak,’ it can be much more efficient to consume knowledge from a trained and skilled counselor than trying to sift through the fine print on your own.
The U.S. Department of Housing and Urban Development, (HUD), is betting on it, announcing $ 6 million in grants to hundreds of national, regional, and local organizations to help families and individuals with their housing needs and to prevent more foreclosures. This is on top of $30 million in housing counseling grants awarded in April.
“Whether you’re a first-time buyer or trying to keep the place you’ve always called home, knowledge is the key to financial empowerment,â€ said HUD Secretary JuliÃ¡n Castro.
“We’re proud to support our housing counseling partners as they help American families achieve stability and prosperity,â€ Secretary Castro adds.
Nearly $6 million will directly support the housing counseling services provided by 33 national and regional organizations, 6 multi-state organizations, 20 State Housing Finance Agencies (SHFAs) and 248 local housing counseling agencies.
(Click here for a list of counseling agencies around the country that received the award grants, and are available to give you free advice).
“Most people don’t fully understand their mortgage,”HUD spokesman Brian Sullivan tells BE.Â “For most people, their home is their most important purchase.Â Not understanding how it works could present big problems,â€ He adds.
In addition, Sullivan points out that grant awardees do not charge for advice or services.
“Once you run into financial difficulty, say you miss a payment, or default in some way, that information is out there. Predators are waiting to call you and say all the right things and offer help at a price. You should never pay for financial advice when you’re strugging.â€
Research shows that mortgage counseling creates results. A study by the Urban Institute found Â Â borrowers in foreclosure were 70% more likely to get up-to-date on payments if they received counseling.
Gerri Detweiler, Director of Consumer Education at Credit.com says counseling is definitely the first step.”As soon as you know you’re going to start falling behind, that’s when it’s time to get this advice,â€ says Detweiler. “If you can’t keep up, you want to know what is going to happen beforehand,â€ she adds.