Emerging Trends

1
Emerging Trends

• For Counselors

2
Pre-Purchase Counseling

• More and more lenders are realizing the
  importance of pre-purchase education as an
  instrument to help prevent financial
  overextension from taking place.

3
Pre-Purchase Counseling

• Prevention is the best cure
• Prepares clients for the costs and
  responsibilities involved in home ownership.
• Why encourage the counseling?
• Help determine the client affordability.
• Understand the effects on the budget.
• Emphasize the importance of savings to offset
  unforeseen home repair expenses.

4
Pre-Purchase Counseling

• Can help prevent many foreclosures through
  education.
• More client/lender incentives are necessary.

5
Understanding Regional Forces

• Decrease in the manufacturing industry
• Decline of the Big Three.
• Resulting layoffs, plant closures and loss of
  overtime.
• There is little new work that can offer the
  previous level of income.
• Income goes down, expenses remain the same.

6
Understanding Regional Forces

• The Ripple Effect
• Eventually all facets of society are effected by
  this disturbance.
• Many business levels drop, resulting in drop of
  overall income.

7
Changes in Client Responsiveness

• Some clients get help upon realizing there is a
  hardship.
• Visit housing assistance websites.
• Calling to get counseling before receiving a
  letter of encouragement to do so by the mortgage
  company.

8
Changes in Client Responsiveness

• We can help them become more responsive.
• Clients should be encouraged to seek counseling
  before they reach the pre-foreclosure stage.

9
Adjustable Rate Mortgages

• These types of loans have become much more
  prevalent in todays market.
• They present both opportunities and problems for
  a growing number of clients

10
Adjustable Rate Mortgages

• Major lenders are assuming proactive roles
• Encouraging counseling to educating their clients
  on the effect that an interest rate increase will
  have on their mortgage loan payment.
• Established a liaison for counselors to contact
  in the event that the new mortgage payment will
  be a problem for the client or if there is a
  danger of foreclosure.

11
Educators and LendersWorking Together

• Now more than ever we observe lenders and
  counselors joining forces to educate clients and
  combat foreclosures.
• A direct link between the two institutions is
  continually being developed and expanded.

12
Educators and LendersWorking Together

• Increasing cooperation in order to prevent
  foreclosures.
• More lenders are appointing counselor liaisons.
• Individuals who communicate directly with the
  counselor to effectively resolve issues and help
  to prevent foreclosures.