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Study: Homebuyer education leading to fewer mortgage defaults

Mortgage defaults decline as much as 34 percent after taking real estate education courses.

Mortgage defaults decline as much as 34 percent after taking real estate education courses.

Apparently, the education new homebuyers are receiving is paying off - literally.

According to a study released by the Mortgage Bankers Association, potential homebuyers who participate in home purchase education courses are more likely to pay their mortgages on time.

J. Michael Collins, who helped conduct the study titled "Homeownership Education and Counseling: Do We Know What Works," said people have been participating in these courses in record numbers since the turn of the century.

"Over the past decade, concerns have been raised about the extent to which Americans as a whole are sufficiently financially literate to make the complex decisions required in the ever-changing financial marketplace," said Collins of the PolicyLab Consulting Group. "In response to these concerns, pre-purchase homeownership education and counseling programs proliferated before the current housing downturn."

Researchers have since found that students of these programs are putting their knowledge to use, as some of the courses helped reduce the incidence of mortgage defaults by as much as 34 percent.

Interest rates continue to be at historic lows, making it more financially feasible for families to afford a home if they're considering moving. According to the latest Freddie Mac survey, 30-year fixed-rate mortgages are at their lowest levels since December 2010.