Fannie Mae announced this week that it will reinstate a requirement for homeownership counseling and education for first-time home buyers obtaining one of its MyCommunityMortgage loans, which give lenders a conforming alternative for low- and moderate-income borrowers, or a loan that relies on nontraditional credit to qualify. Effective January 1, 2009, the requirement is geared toward helping borrowers better assess their options and responsibilities both before and after they purchase a home, Fannie Mae said in a press statement.
xHigh quality counseling provides the first-time home buyer in particular with reliable information and the resources necessary to make the kind of informed decisions that ultimately lead to sustainable homeownership,x said Herb Allison, president and CEO, Fannie Mae. xIn this extraordinary market, we think it is critical to reinstate this requirement and to work with counseling agencies and our lender partners to help homeowners succeed.x

The required borrower counseling will be provided according to the National Industry Standards for Homeownership Education and Counseling, or those of comparable quality as established by other organizations, Fannie Mae said. The National Industry Standards for Homeownership Education and Counseling were developed by a national advisory council of industry stakeholders, including Fannie Mae, and spearheaded by the NeighborWorks Center for Homeownership Education and Counseling.
xToo often, home buyers arrive at the settlement table without a full understanding of the terms and conditions of their loan or the overall responsibilities of homeownership,x said Ken Wade, CEO, NeighborWorks. xNow, more than ever, the housing industry recognizes the need to ensure high quality education, and counseling is a key step on the path to homeownership, particularly for new home buyers. We applaud Fannie Mae for taking this step.x
Fannie Mae said that it would continue to encourage face-to-face education and counseling and recommends telephone counseling for borrowers who are unable to attend face-to-face sessions or who do not have an eligible provider in their area.
For more information, on Fannie Mae’s home buyer education and counseling, click here.