housing counselor speaking with a client

What Is A Housing Counselor And How Can Housing Counseling Help Me?

Melissa Brock5-minute read

July 01, 2021

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It's normal to feel intimidated by the complexities of buying a home, but remember that you're not alone. If you have questions about the process or know you will encounter trouble making your mortgage payments in the near future, you may want to find an expert to walk you through these steps.

Consider getting a housing counselor to help you navigate.

What Is A Housing Counselor?

Housing and Urban Development (HUD)-approved housing counselors can help assess your financial situation and evaluate options for paying your mortgage loan. These government-trained and certified counselors can also make a plan to help you with your mortgage for free or for a low cost.

HUD-certified counselors generally work with local agencies that specialize in neighborhood and low-income housing and offer classes for first-time home buyers.

A housing counselor can also help with more than just these needs – they can help you with a number of situations, including homelessness, renting an apartment and buying a home that's been foreclosed on.

When Should I Consider Working With A Housing Counselor?

You may want to consider working with a housing counselor no matter what type of housing situation you have – good or bad. You can get advice from a housing counselor if you just need to learn more about buying a home or renting. However, you may also need advice if you think you will default on your mortgage, if you want to foreclosure, if you experience credit issues and/or think you need a reverse mortgage.

You may consider using a real estate agent to learn more about buying a home – many real estate agents also offer first-time home buyer classes. However, real estate agents typically use those classes to drum up clients for their business. In contrast, housing counselors have no financial stake in the advice they provide.

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How Does Housing Counseling Work?

Housing counseling works best if you get help as soon as possible. For example, if you have just learned that you will have trouble making your rent or mortgage payments or if you’re just starting the process of buying a home, you want to get help right away. Housing counselors can offer home buying assistance to help you get into a home faster. Waiting may put you on a slower track to achieve your goals. Take these steps:

  • Step 1: Contact a HUD-certified counselor. You can schedule an in-person meeting.
  • Step 2: The counselor will listen to your concerns or questions and ask you for information about your mortgage loan. They may ask questions about the amount you owe and the date of your last payment. You may need to answer questions about your pay stubs, tax returns, recent bank statements and other bills you pay each month.
  • Step 3: The counselor will gather as much information as possible about your financial situation and offer a solution.

Find A HUD-Certified Counselor

Are you ready to find a HUD-certified counselor? The HUD website offers a list of HUD-certified counselors in your area. You can also call HUD's interactive voice system at (800) 569-4287.

If you specifically face foreclosure, you can search the list of foreclosure avoidance counselors or visit the Making Home Affordable program Q for Borrowers.

You can also talk to a reverse mortgage counselor for advice specifically about reverse mortgages.

Gather Your Documents

Before you contact a HUD-certified counselor, gather some information that a housing counselor will need to know to help you:

  • Mortgage statements
  • Loan documentation
  • Credit card statements
  • Personal identification, such as a driver's license
  • Proof of occupancy
  • Paystubs and proof of other income
  • Bank statements
  • A list of monthly expenses
  • Proof of home occupancy
  • Other information the counselor may need

Make A List Of Questions

A housing counselor can offer advice on a wide range of financial matters and can help you with your budget, so it's a good idea to come prepared with a list of questions to ask so you get all the help and information you need. You may want to ask the following questions, though the questions depend on your particular situation:

  • What additional documentation do you need from me?
  • What can I do to help resolve my situation?
  • How long before you hear from my lender?
  • How do you typically work with individuals on an ongoing basis?
  • How can I do a follow-up visit if I have more questions?

Write down other questions you come up with during the course of your meeting. Your conversation may spark more questions as the counselor talks to you.

Set A Goal

Housing counselors may often ask to meet with you more than once, to help set goals and create a sense of accountability.

The counselor will create a client action plan during your first counseling session. During this session, the counselor will listen to your housing problem or need to better understand your finances in relation to your housing goal. Finally, the counselor will help you outline specific steps to achieve your housing goal.

Make sure you actively participate in setting goals for yourself with the HUD counselor. What immediate goals do you have? Also, consider your financial goals beyond an emergency that might have required you to meet with a housing counselor in the first place.

Who Is Eligible For HUD Counseling?

You may wonder about who should find a housing counselor.

Anyone can tap into housing counseling – first-time home buyers, existing homeowners and renters can all learn about homeownership and affordable housing.

Furthermore, anyone facing homelessness, eviction, foreclosure or considering a reverse mortgage can receive HUD counseling. Senior citizens considering a reverse mortgage may get counseling for free. Low-income wage earners can also access free counseling, though some agencies offer services on a sliding scale basis.

Some programs, like the Section 8 Home Buyer’s Program, require you to complete housing counseling before you can take advantage of the program.

How Do I Find A HUD-Certified Housing Counselor?

Check the HUD website to make sure you only work with a HUD-certified housing counselor. Scam artists often pose as debt relief consultants who falsely claim that they are HUD-certified and are actually not approved to be CFPB housing counselors. These scammers often make promises that guarantee they can lower your payment or eliminate debt completely.

You can protect yourself and others by calling the NeighborWorks America, the Lawyers’ Committee for Civil Rights Under Law and the Homeowners’ HOPE Hotline at 888-995-HOPE to warn law enforcement agencies.

How Much Does It Cost To Work With A Housing Counselor?

Agencies generally offer free or low-cost services, depending on the partner agency. Agencies must offer foreclosure prevention and homeless counseling services for free.

Housing counseling agencies can charge reasonable and customary fees for other forms of housing counseling and education services, including prepurchase, reverse mortgage, rental counseling and other services as long as: 

  • They provide counseling without charge to persons who demonstrate they cannot afford the fees.
  • They inform clients of the fee structure in advance of providing services.
  • Fees match the level of services provided.

The Bottom Line: Accept The Help Of Those Who Know What It Takes.

Anyone who has questions about the journey to finding, buying or staying in a home should get help from a HUD-certified housing counselor. Check the list of HUD-certified counselors in your area (and avoid scammers in the process). Next, schedule an appointment. Gather your documents, put together a list of questions and set a goal for after the meeting. You may want to go back to a housing counselor more than once to make sure you stay on track.

Thinking about buying your first home after reading about housing counselors and how they can help? Read more in our Learning Center.

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Melissa Brock

The Rocket Mortgage Learning Center is dedicated to bringing you articles on home buying, loan types, mortgage basics and refinancing. We also offer calculators to determine home affordability, home equity, monthly mortgage payments and the benefit of refinancing. No matter where you are in the home buying and financing process, Rocket Mortgage has the articles and resources you can rely on.