For Immediate Release
May 8, 2006
Contact: Sherry Saunders, 202-220-2360; ssaunders@nw.org

Three More Mortgage Industry Leaders Join Coalition with
NeighborWorks to Avert Home Foreclosures
Calls from Homeowners Seeking Help Increases Since Launch

(Washington, D.C.) – Three more financial services institutions, Freddie Mac; American General Financial Services, Inc., a member of American International Group; and ABN AMRO Mortgage Group, Inc., an indirect subsidiary of LaSalle Bank Corporation, are teaming up with 12 other major companies, the NeighborWorks® Center for Foreclosure Solutions and the Homeownership Preservation Foundation to help delinquent borrowers find solutions to avoid home foreclosure.

Altogether these 15 institutions are committing more than $1 million to the NeighborWorks Center for Foreclosure Solutions, and are also contributing valuable trade insights and information that will help educate counselors who will assist financially troubled homeowners learn how to work with their lenders to avoid foreclosure and stay in their homes.

The program was launched April 11, 2006, in Ohio where foreclosures have more than doubled in the last five years. The national program will target key hotspots across the country where foreclosure rates have skyrocketed. The effort will link homeowners in danger of foreclosure to the Homeownership Preservation Foundation hotline (888-995-HOPE) where they will learn strategies and receive counseling to help them keep their homes. Callers needing additional face-to-face counseling will be referred out to local nonprofits for experienced, third-party counseling help.

As a result of the intensive publicity and information provided to Ohioans during the launch period, calls from Ohio homeowners to the 888-995-HOPE Hotline have risen from 10 a day to 50 a day. More than 250 borrowers have been counseled by the HOPE Hotline and another 75 have been referred to Ohio NeighborWorks organizations for additional face-to-face counseling, resources and assistance.

“We are heartened by the increased number of Ohio homeowners seeking advice on how to avoid foreclosure as a result of the program’s announcement. The earlier homeowners seek assistance and guidance the better their chances are of avoiding foreclosure,” said NeighborWorks America CEO Ken Wade. “We welcome Freddie Mac, American General and ABN AMRO Mortgage Group to this exciting and important project that will help maintain healthy neighborhoods across the country.”

The national partnership will provide three solutions to avert foreclosures:

1. Better research and early alert systems. Targeted research will identify various factors contributing to increased home loss in specific markets, which in turn will assist in developing and implementing specific strategies.
2. Improved counseling capacity to cover a range of triage needs for those on the brink of foreclosure, particularly the ability to more effectively negotiate with lenders and servicers. Lender-offered repayment plans have reduced the home loss of low-and moderate-income borrowers by 68 percent. (Cutts and Green, 2004)
3. Increased public and private partnerships among cities, lenders and servicers aimed at averting foreclosures. For example, an innovative campaign spearheaded by the city of Chicago, the Homeownership Preservation Foundation and NeighborWorks organization NHS of Chicago prevented more than 700 foreclosures in the past 18 months.

The original 12 participating lending institutions include:

• Bank of America
• Citigroup
• Countrywide Home Loans
• HSBC– North America
• Chase
• National City Mortgage Co.
• New Century Financial Corporation
• Ocwen Loan Servicing, LLC
• Option One Mortgage
• Residential Capital Corporation
• Washington Mutual
• Wells Fargo

The majority of lending institutions on this list are members of the Housing Policy Council of the Financial Services Roundtable.

About NeighborWorks America
The NeighborWorks Center for Foreclosure Solutions is an initiative of NeighborWorks America, a nonprofit organization providing financial support, technical assistance and training for communities across the nation, including the NeighborWorks network—a nationwide network of more than 245 community development organizations working in more than 4,400 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 $10 billion in reinvestment and helped more than 780,000 families of modest means purchase or improve their homes or secure safe, decent rental or mutual housing.