Congress and many researchers and practitioners in the field of housing counseling have asked whether pre-purchase homeownership counseling for higher risk borrowers leads to better borrower outcomes and reduced lender risk relative to no counseling. Prior research has suggested there are benefits of pre-purchase homeownership counseling, but those benefits have been questioned for over 20 years by concerns that those who choose counseling may be different than those that who do not choose to get counseling (selection bias). HUD designed The First-Time Homebuyer Education and Counseling Demonstration as a rigorous, large-scale, randomized experiment to definitively answer the question about the relative efficacy of homebuyer education and counseling on higher risk borrowers. This Early Insights report demonstrates that HUD has successfully implemented the first large-scale national experiment of homebuyer education and counseling that promises to become a foundational source of evidence for policymakers, lenders, and housing counseling practitioners and advocates regarding the impacts of homebuyer education and counseling.

Click here for the HUD First-Time Homebuyer Study