Home buying can be an intimidating process, especially for first-time house hunters. That’s one reason why the FHA has a network of housing counselors and an assistance hotline available; if you’re looking for an FHA home loan and need help getting started, that assistance is definitely available.
At the FHA official site, you’ll read the following; “Want advice on buying a home, renting, default, foreclosure avoidance, credit issues or reverse mortgages? HUD sponsors housing counseling agencies throughout the country to provide free or low cost advice.”
When you call the FHA at (800) 569-4287, you’ll get access to a phone-based search system that can refer you to a housing counseling agency near you. You can also search for a housing counseling agency near you online at http://www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm by using the interactive map of the USA to pinpoint your location. These agencies are FHA-approved and borrowers can choose the one most convenient for them based on location.
It’s important to note that not all housing counseling services are free. Some are fee-based, and according to FHA guidelines must charge “reasonable and customary” costs for services rendered. The services for house hunters may require a fee, but some FHA-approved housing counseling is free by law. Those free services include foreclosure avoidance counseling and homelessness prevention.
For the services that do require a fee, the FHA rules state housing counseling agencies are “permitted to charge reasonable and customary fees…for forms of housing counseling and education services, including pre-purchase, reverse mortgage, rental, and non-delinquency post-purchase counseling services…”
Fees may only be charged when conditions are met including a requirement that fee-based counseling be provided without charge for people “who demonstrate they cannot afford the fees”.
In addition, the FHA-approved counseling agency must tell you the costs of your counseling services in advance and the fees must be “commensurate with the level of services provided.” The FHA advises borrowers to contact the nearest FHA/HUD office if you are working with an FHA-approved agency that does not comply with these rules.