26 Aug 2013
FNB’s Housing Finance division has taken its compulsory homeownership education programme for first-time buyers, out of the classroom and onto the web with great success.
First-time homeowners applying for a Smart Bond are expected to complete the course before registration of their bond. Seventy five percent of bond applicants are now choosing to use the e-learning system and since the introduction of e-learning in February 2013, FNB has seen an 87 percent decrease in turnaround time for completion of the course from 9.8 days to an average of 1.3 days.
Marius Marais, CEO of FNB Housing Finance, says their homeowners programme has always been an important aspect of the bond registration process for their customer. He says good quality financial education on owning a home is vital in order to ensure that homeowners understand the financial impact of their decisions and make the most of their biggest asset.
The bulk of homeowner or borrower education occurs in a traditional classroom setting with training courses falling over the weekends. He says while the effectiveness of a motivated, knowledgeable trainer is undisputed, there are a few challenges that they have found using the traditional classroom method.
One of the major issues is that delays in completing the training course hinder the customer’s bond application and registration at the Deeds Office. Traditional classroom training occurs at many different third party locations across the country and trainers need a sufficient number of provisionally approved customers assigned by the lender to start a course. This can sometimes be delayed up to a month, especially in remote areas of the country.
Marais says a delay of even a month can make a big difference to a new homeowner who has taken a big step to purchase a home.
Another challenge is the consistency and quality; all trainers need to cover the entire curriculum with good communication and knowledge. It is hard to keep the standard of education consistent across the entire country.
“With the introduction of the e-learning programme, many of these challenges have fallen away. Customers are now completing the course in just over a day and scoring high pass rates.”
There are currently 4 000 first-time homeowners who have either completed or are currently completing the course through e-learning.
Marais says they have also seen a sharp increase in participation rate with an average of 75 percent of new homeowners opting to do the course via e-learning since February this year. With an 83 percent participation rate in May, they are expecting this number to continue to rise, he says.
Once a customer’s application is approved, they receive an sms or email directly with a log-in for the e-learning site. Customers can then complete the programme which includes high definition education videos clips, graphs and a multiple choice questionnaire that needs to be completed before the homeowner is certified to have completed the course.
“We have found that there is a higher average quiz score as a result of the e-learning of 87 percent - this is directly due to the engaging and interactive nature of the web based learning.”
The course covers all aspects of homeownership such as the impact of longer loan terms, preparing to sign mortgage documents and other personal finance issues such as managing credit.
Marais says e-learning, with good quality information and quick turnaround times seems to be the way in which to spread consumer education. Obviously, he says they will still cater for those that are unable or unwilling to learn via the FNB e-learning programme, however, for the vast majority of their customers, this is a good interactive way in which to engage and they are delighted with its success.
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