Business Perspective: Informed Financial Decision Making is the Key to Homeownership | News from local businesses
Children from low-income households and communities of color are less likely to have access to financial education.
NextGen’s 2021 State of Financial Education report found that in schools where 75% or more of the student body are either minorities or eligible for free or reduced lunches, less than 8% were assured of take a self-sustaining personal finance course before graduation.
According to the 2019 NFCC Consumer Financial Literacy Survey, barriers to homeownership may be in part a direct result of financial illiteracy, including poor or no credit history and a lack of understanding of the issues. basics of buying a home.
Given their position in the community, banks can play a critical role in bridging the knowledge gap by promoting financial education.
Homeownership has long been the foundation on which Americans climb the economic ladder, as it creates an accumulation of wealth in the form of equity and provides better access to credit.
While there are challenges with the housing supply, creating a more financially educated society will provide opportunities for more Americans to access the benefits of homeownership.
Data shows that financially educated consumers are more likely to have better long-term housing outcomes.
A 2017 study found that borrowers who received counseling before purchasing a HUD-compliant home were 42% less likely to experience a foreclosure.