Foreclosure Counseling Nearly Doubles Chances of Mortgage Modification, Reduces Likelihood of Re-default by at Least 67 Percent

By Eileen Fitzgerald,
CEO, NeighborWorks America

I’m excited to share with you today the results of a new report prepared by the Urban Institute on the consumer benefits of the National Foreclosure Mitigation Counseling (NFMC) Program.

The report shows that the NFMC program works incredibly well for homeowners and communities. Homeowners who received NFMC counseling were nearly twice as likely to obtain a mortgage modification as those who did not seek assistance from an NFMC foreclosure prevention counselor. Homeowners counseled through NFMC were at least 67 percent more likely to remain current on their mortgage nine months after receiving one.

The report also shows that homeowners received, on average, a mortgage modification that lowered their payment by $176 more per month, than homeowners who didn’t work with an NFMC counselor – a savings of close to $2,100 a year.This reduction in household expenses can free up funds for paying off debt, saving for college and meeting other needs.

The improved long-term sustainability of the borrower is led largely by the financial counseling that is a part of foreclosure prevention, not by the lower mortgage payment obtained. The personalized work nonprofit housing counselors do to help homeowners improve their overall financial situation had the greatest effect on a homeowner not falling behind again on their mortgages in the future.

The NFMC program also has benefits for mortgage servicers and investors. By significantly reducing the chance that a homeowner re-defaults after a mortgage modification, servicers are saved added expense. This tells us that increased servicer investment in partnerships with nonprofit counselors is a win for everyone.

If you’d like to learn more, I was recently interviewed about this report. See YouTube video.

NeighborWorks America Honors Senator Kit Bond with Lifetime Achievement Award



Former Senator Bond receives Lifetime Achievement Award.
(L-R): Kit Bond; Mark Stalsworth, executive director,
Kansas City NHS; John A. Wood, assistant city manager
 for neighborhoods, City of Kansas City;
Eileen Fitzgerald, CEO, NeighborWorks America 

NeighborWorks America, as part of its NeighborWorks Training Institute in Washington, DC this week, honored Former Senator Christopher S. “Kit” Bond with a lifetime achievement award for his more than 40 years of support to America’s families.
Presenting the award to Senator Bond, NeighborWorks America CEO Eileen Fitzgerald noted that he is known for a long string of accomplishments on behalf of families and accessible housing, beginning with his service as Missouri’s youngest governor and continuing through four terms as one of Missouri’s U.S. Senators.

“Senator Bond has been a leader for families and housing,” said Fitzgerald. “He continues that leadership as a co-chair of the Bipartisan Policy Center’s Housing Commission. We are excited and sincerely honored to recognize Senator Bond for all the work that he’s done and continues to do for housing in the United States.”

Learn more about Senator Kit Bond's work in support of affordable housing.

NeighborWorks Member Homeport Brings ABC’s 'Extreme Makeover: Home Edition' to Ohio



The Rhodes family was surprised to learn they will
get a new home from ABC's Extreme Makeover.
WATCH THE VIDEO.
Tune in to ABC on Friday, Dec. 16 at
8pm, EST to see the transformation!

 

NeighborWorks member Homeport aka Columbus Housing Partnership assisted the ABC network program Extreme Makeover: Home Edition to bring attention to the Rhodes family and the forgotten Ohio neighborhood called American Addition, where they lived.

According to the Columbus Dispatch, the neighborhood has been singled out by Columbus Mayor Michael B. Coleman as “the most egregiously neglected urban neighborhood I have ever seen.” The mayor is investing $5 million to rebuild streets and alleys and install sidewalks, lights, curbs, waterlines and storm-sewer lines, while federal Neighborhood Stabilization Project money will help to pay for 150 new homes.

The city doesn’t have to worry about one of those homes, however. It has been rebuilt by the cast and crew of Extreme Makeover. The process started two years ago, when Homeport’s volunteers and staff went door to door talking to families and helping those interested in completing the lengthy application process. Homeport helped the families create videos to accompany their applications and helped shoot additional supporting video discussing the neglected neighborhood's history.

In August, the cast of Extreme Makeover knocked on the door of James and Jackie Rhodes and surprised them with the news that they had been chosen to receive a brand new home because of their family’s love and commitment to each other. The Dispatch reports that the Rhodes had taken in their daughter Mikia and her four children, after Mikia had emergency surgery to cure a brain tumor. She slept with her children — ages 7, 9, 15 and 18 — in the main sitting room on the first floor, while her parents occupied the only bedroom upstairs. The home was not only cramped, it was also in desperate need of repair.

Now thanks to Homeport and Extreme Makeover, the Rhodes have a brand new home for the holidays. The episode showing the whole process will air on Friday, December 16 at 8 p.m. Eastern time. Some members of the Homeport team made cameo appearances in the show as elves and others may appear talking about the organization's programs. Tune in!

NeighborWorks Northeast Region Honors Two Visionary Leaders for Their Impact on Communities

More than 250 guests joined CEO Eileen Fitzgerald and Northeast Regional Director Deborah Boatright at the sixth annual NeighborWorks America Northeast Region Reception to honor two visionary leaders in Community Development: Marc Jahr, President, of the NYC Housing Development Corporation and George “Mac” McCarthy, Director, Metropolitan Opportunity Unit of the Ford Foundation.

L-R: Peter Meyer, president, New York Market, TD Bank; Eileen Fitzgerald; Marc Jahr; George McCarthy; Deborah Boatright; Dennis Lagueux, SVP, Community Development, TD Bank

Both men are widely admired for their integrity, intelligence and impact on communities. Marc Jahr has helped to create over 100,000 units of affordable housing in New York City over the course of his career, and is an icon in the field. George McCarthy has been an invaluable partner to NeighborWorks for over a decade, in our Homeownership Campaign, Success Measures initiative, community stabilization work and support for Manufactured housing and resident-owned communities.

The sixth annual reception, sponsored by TD Bank and held at the Westin New York at Times Square, was the first under the new regional model. The Northeast Region spans 11 states from Maine to Maryland, as well as Washington DC, Puerto Rico and the US Virgin Islands. “Our regional configuration allows us to have a broader conversation with our partners and funders, as we now mirror many of their footprints. And we have a new depth of experience to bring to the table with our state and local government partners as well,” noted Boatright.

“The incredible turnout for today’s event is a testimony to the value of our network, and the work of the Northeast Region,” noted Fitzgerald. TD Bank will also be the sponsor of a spring reception planned for Boston.

The reception’s theme, “A Community United” was evoked by both honorees in their remarks to characterize not only the cross-section of people in the audience, but the strength of their partnerships and collaborations to improve opportunities for a better life in communities throughout the area.

More photos can be seen on NeighborWorks’ Flickr site.

New Federal Effort Launched to Combat Loan Modification Scams

NeighborWorks was so pleased to learn yesterday that the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), the Consumer Financial Protection Bureau (CFPB), and the U.S. Department of the Treasury have joined forces to combat scams targeted at homeowners seeking to apply for the Home Affordable Modification Program (HAMP).

The joint task force issued this consumer fraud alert, which provides vulnerable homeowners with tips for avoiding mortgage modification scams. In addition to providing education programs to protect struggling homeowners, the federal agencies will work together and with law enforcement partners to investigate and shut down these scams, and will ensure the perpetrators pay for their crimes.

This collaborative federal effort strengthens the work we have been doing for the past two years through the Loan Modification Scam Alert Campaign to help vulnerable homeowners recognize the signs of scam and to learn where to turn for legitimate help.

Scam artists hide behind many titles — Loan Modification Consultant, Forensic Foreclosure Consultant, Short Sale Negotiator, to name a few — and they sometimes falsely represent themselves as government programs. Even trusted professionals like real estate agents or attorneys have been involved in loan modification scams.

It can be hard to spot a scammer, so the best way for homeowners to protect themselves is to know the signs. And the best way to shut down these scams is to report them. Legitimate help is FREE and available from a HUD-approved housing counselor.