NHS of New Haven's Teen-Parent Credit Counseling Courses

Category: Best Strategy for Reaching Minority Homebuyers

Information About Innovation:
Title:	NHS of New Haven's Teen-Parent Credit Counseling Courses
Summary:	NHS of New Haven, CT, provides financial counseling to more than 500 prospective homebuyers each year. An analysis of prospective homebuyers’ applications and credit reports has indicated an alarming tendency toward extensive credit problems. As a result, we devised an innovative program to address potential problems before they occur. Our teen-parent credit counseling classes reach young people and their parents before the teens have a chance to obtain (or abuse) credit.
Detailed Description:	As indicated above, Neighborhood Housing Services of New Haven has been providing homebuyer education and counseling to more than 500 individuals and families each year for the past four years. Participants attend an initial orientation session, at which time the home purchase process is explained and we review the procedures by which participants get to the point where they qualify for a mortgage to purchase a home. Attendees fill out applications, and credit reports are obtained for each of the prospective homebuyers. An analysis of the applications and credit reports has indicated an alarming tendency for our minority clients to have serious credit problems. In many cases, the credit problems are so severe that they require extensive remediation and result in considerable time delays before the clients can qualify for conventional mortgages. While our staff members have always worked with our clients to help them clean up their credit, we realized that we could create an innovative program that would address the basic causes of the problems before they could take root by conducting teen-parent credit counseling classes. These sessions reach young people and their parents at a point in time before the teens have an opportunity to use (or abuse) the credit that will surely be extended to them when they turn 18. The program is targeted at high school sophomores. Initial outreach is directed at the parents through parent-teacher organizations in New Haven’s high schools. Parents who are excited by the concept of the teen-parent credit counseling workshops bring their high school child to a series of workshops that cover credit issues and implications. The content of the sessions is modeled after our basic financial fitness curriculum, with an added emphasis on credit management. The full course consists of four two-hour sessions, given in consecutive weeks. Because our classes are directed at teens as well as their parents, games and simulations are employed to motivate participation and to elicit enthusiasm for the program. The second phase of the program consists of having NHS staff going into the classrooms where “graduates” of our teen-parent workshops are in attendance. Credit issues are presented to the class, and students who have attended our classes are eager participants in the discussion. This motivates other students to want to learn more about credit issues, and these students then get their parent(s) to accompany them to the workshops. Thus, in the initial stage of the program we reach out to parents and have them involve their high school students, while in the second stage of the program we target the teens and have them bring their parent(s) into the program. The goal of this program is to provide a mechanism through which minority families can approach the home purchase process without the burden of having to deal with credit problems. Nothing is more disheartening to a client than having his or her heart set on buying a particular house, only to find that credit issues prevent him or her from being able to obtain a mortgage. Indeed, such discouragement can be so profound that prospective buyers may be forever thwarted from their dream of homeownership. The teen-parent credit workshops conducted by Neighborhood Housing Services of New Haven provide an innovative way to help young minority adults avoid credit problems that could cause immeasurable harm in their future pursuit of homeownership.
Projected Cost:	The teen-parent credit counseling workshops are expected to have an annual operating cost of $15,000 per year. This includes a pro-rata share of our housing credit counselor’s time plus materials that are used during the workshops. It also includes incentive and promotional materials to motivate participants in the workshops, along with refreshments. $9,500 of the first year expenses are being paid by a grant from Casey Family Services. Neighborhood Housing Services of New Haven and the New Haven HomeOwnership Center are absorbing the balance of the cost, as this initiative is considered an off-shoot of our pre-purchase financial fitness program. We do not expect significant increases in the cost of administering this program in the future, and believe it to be a very cost-effective way to promote financial literacy and prudent debt management skills among minority group members from a very early age.
2003 Outcomes:	This is a new program initiated in 2004, so results from 2003 are unavailable. However, projections for 2004 are that we will have 50-100 participants complete the series of workshops that will make them poised for homeownership at a point in time that meets their needs and desires.
Website:	http://www.nhsofnewhaven.org
Keywords:	Counseling, Credit, Financial, Homeownership, Multi-generational
Information About Organization:
Name:	Neighborhood Housing Services of New Haven, Inc.
Address 1:	333 Sherman Avenue
City, State, Zip:	New Haven, Connecticut  06511
Org. Status:	501c3 Non-Profit
Contact Name:	James A. Paley
Contact E-mail:	jpaley.nhs@snet.net
Contact Phone:	(203) 562-0598

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