For Immediate Release
November 22, 2005
For more information, contact:

Jennifer Bellini Communications Director Homeownership Preservation Foundation jbellini@hpfonline.org 952-857-6410

Becky Fleischauer Manager, Media Relations NeighborWorks® America rfleishauer@nw.org 202-220-2360

Partnership Helps Homeowners Facing Foreclosure
Homeownership Preservation Foundation Forms Partnership with NeighborWorks® America to provide up to $1.275 Million Grant to NeighborWorks for Homeownership Education and Foreclosure Prevention

MINNEAPOLIS (November 22, 2005) — More help is on the way for homeowners whose financial difficulties may place them at risk of losing their home to foreclosure.

The Homeownership Preservation Foundation (HPF), a Minneapolis-based national nonprofit dedicated to preserving homeownership and preventing home foreclosures, has joined forces with NeighborWorks America to jointly expand their efforts in reaching homeowners as early as possible to prevent homeowners from reaching the point of foreclosure. The partnership will link HPF's 1-888-995-HOPE toll-free hotline, which offers free foreclosure prevention counseling and advice, with NeighborWorks' national network of organizations that provide homeownership education and counseling services.

To fund this joint venture, the Homeownership Preservation Foundation has committed to grant up to $425,000 over the next twelve months to support a nationwide campaign to inform and educate U.S. homeowners about homeownership. HPF may contribute an additional $850,000 over the next two years based on the success of the program.

Under the partnership, NeighborWorks America will use the grant to fund the development and implementation of foreclosure prevention workshops in communities served by NeighborWorks. The workshops will be developed by NeighborWorks Center for Homeownership Education and Counseling. NeighborWorks is the nation’s largest certifier of homeownership education counselors, and the NeighborWorks network of more than 240 organizations operating in 50 states offers a range of services, including face-to-face consumer counseling.

In addition, grant funds also will be used to support face-to-face counseling provided by NeighborWorks to local homeowners. NeighborWorks America serves 2,700 urban, suburban and rural communities across America.

In turn, NeighborWorks America will support a nationwide public service campaign aimed at encouraging homeowners to contact 1-888-995-HOPE to receive foreclosure prevention counseling facilitated by the Homeownership Preservation Foundation through counseling agencies that are certified by the U.S. Department of Housing and Urban Development (HUD).

The two nonprofits also will work together to fund foreclosure prevention research and to conduct high-level forums to draw attention to foreclosure issues.

Research and experience shows it is much less expensive to counsel and restructure loans than to foreclose. The cost to the borrower includes a lost home, equity and ruined credit. The cost to community includes up to $30,000-50,000 in law enforcement services and lost economic development. And, contrary to some common misperceptions, mortgage investors may lose as much as $50,000 on each foreclosed home.

“Every minute counts in averting foreclosures,” says Ken Wade, CEO of NeighborWorks America.“Research shows that early contact — within the first 15 days of missing a payment — is critical in saving homeowners and their communities from the devastation of foreclosure. A toll-free hotline will make it easier for consumers in trouble to pick up the phone.”

More than half of those in foreclosure did not call for help when they fell behind in their mortgage payments. “People are hesitant to call their bank due to lack of trust, fear or embarrassment. NeighborWorks organizations can act as counselors between the individual and the bank, empowering residents to continue making payments and avoid foreclosure. We are excited about this partnership and expect the availability of the
1-888-995-HOPE hotline will make it easier for consumers to get help,” Wade added.

“Our partnership with NeighborWorks America will further help reduce foreclosures through innovation and education,” adds Walt Fricke, president and executive director of the Homeownership Preservation Foundation. “By spreading the word about 1-888-995-HOPE, offering homeowners the choice to receive face-to-face help, and educating homeowners about how to avoid foreclosure, we have a real chance of making a difference.”

Because fast action is so important, in the early stages borrowers must be triaged, determining whether the family needs help to fill short-term or long-term income gaps, aid to repair property damage, and/or assistance in budgeting and money management. Based on these needs NeighborWorks can deploy a range of services: public education, face-to-face counseling referrals, bridge loans to help consumers falling behind in payments catch up, rehab loans for repairs and maintenance, and a body of experience and research to ensure the intervention strategies used are effective — in addition to the telephone-based counseling and advice that the Homeownership Preservation Foundation can provide through its 1-888-995-HOPE hotline.

"We want to reach homeowners when they're in denial about their financial difficulties," notes Fricke. "The earlier we can reach homeowners and make them aware of what they're facing, the more options they have in addressing their financial issues and ultimately preventing foreclosure."

The NeighborWorks foreclosure program is based on a proven formula first developed by a NeighborWorks organization in Chicago — Chicago Neighborhood Housing Services (NHS). Together, with the city of Chicago, the Homeownership Preservation Foundation and numerous mortgage lenders and servicers, counseling was provided to several thousand homeowners and helped prevent hundreds of foreclosures in the past two years. Through Chicago’s Homeownership Preservation Initiative, homeowners facing foreclosures can call a hotline to be linked to a representative from a nonprofit credit counseling agency. The counseling agencies in turn work with area lenders to work out payment schedules that avert foreclosure.

About The Homeownership Preservation Foundation

The Homeownership Preservation Foundation (HPF) received its 501(c)(3) status in September 2004. The foundation partners with city, county and state governments; federal government agencies; community-based non-profit organizations; and mortgage lenders and servicers to offer creative solutions to preserve homeownership. For more information about the Homeownership Preservation Foundation, please visit www.hpfonline.org.

About NeighborWorks America

NeighborWorks America provides financial support, technical assistance and training for communities across the nation, including the NeighborWorks network—a nationwide network of more than 240 community development organizations working in more than 2,700 urban, suburban and rural communities across America. These organizations engage in revitalization strategies that strengthen communities and transform lives. In the last five years alone, NeighborWorks organizations have generated more than $8.5 billion in reinvestment and helped more than 500,000 families of modest means purchase or improve their homes or secure safe, decent rental or mutual housing. Foreclosure prevention is a key NeighborWorks America initiative.