April 7, 2004
Class offers home buyers advice
Course helps people navigate setbacks for first-time home buyers
By Carol South
Herald contributing writer
For low-income families, single parent families or people with shaky credit histories, buying their first home can be a frustrating series of hurdles, setbacks and heartbreaks.
To help consumers navigate these challenges, the Northwest Michigan Human Services Agency has been holding a series of free educational workshops. Topics covered include home buying, asset management, financial management and home maintenance.
Bethany of Traverse City, who declined to give her last name, was one of 14 attendees at Monday evening's session on pre-purchase information.
With minimal income from Social Security Disability, Bethany has been trying to buy her own home but has repeatedly hit brick walls. She has worked through both Homestretch and Habitat for Humanity, but nothing came together for her.
"Mainly it's my credit, but there is also some stuff on it (credit report) that shouldn't be," she said, adding that the class's information on filing dispute forms with credit bureaus was very helpful.
"I had given up, but then somebody told me about this," she added. "I tried before, that's for sure, for a few years."
She noted that the area's high real estate prices are a barrier to families like hers: a low-income, single mother of a minor child. But that does not mean she does not dream the American Dream.
"I want my own place, I've been a renter for it seems like forever and I'm getting tired of moving," Bethany said. "It's like planting a tree and digging it up, planting it again and digging it up; sometime it will die."
Kevin Cranson, a budget/housing counselor with the Northwest Michigan Human Services Agency, led the seminar and discussed the benefits and pitfalls of home ownership. He also guided participants through the steps of buying a home and showed a video about the process of closing on a home.
"The first question you have to ask yourself is are you ready to buy a home," he told attendees. "Do you have a steady source of income, stability of employment, a good credit history, pay bills on time and money saved for a down payment."
Cranson also talked about credit, credit reports, down payments, principal and interest and resources to help low-income buyers. He accessed a web site that calculated payments and total loan interest for varying mortgage amounts, durations and interest rates. He also described the roles and legal obligations of buyer and seller agents as well as dual agents.
He encouraged potential buyers to be empowered in their decisions by shopping around for the best interest rates and terms.
"As a wise consumer, you should shop around for a mortgage," he said. "Compare rates at four or five mortgage companies at least and definitely let the mortgage companies know, so they compete and provide the best rate."
Three real estate agents also attended the seminar, one looking for specific help for a client and others gathering general information. Gwen Hall, a realtor with Real Estate One in Traverse City for 18 months, found the class useful.
"I think that what I walked away with is that it gave them serious thought," she noted. "Everyone thinks, 'I want to own a home,' and they don't look at everything involved in it."
She also added that typical first time homebuyers are in a financial, personal and professional position to make a smooth transition from renting to owning. Non-traditional buyers need extra help and information available in classes such as this one.
"I think what we were looking at Monday night were people who would have trouble getting into a home," she added. "Usually if your income level is below 20K you just don't look."
The Northwest Michigan Human Services Agency has three more free classes open to the public scheduled for Mondays in April. Topics are Credit Repair on April 12, Caring for Your Home on April 19 and Plumbing on April 26. For more information on these classes or to register, call 947-3780.