PITTSBURGH, PA, January 18 -- In a visit to
Neighborhood Housing Services of Western Pennsylvania, the first NeighborWorks organization in the country, U.S. Senator Bob Casey (D-PA) announced a $180 million appropriation for subprime mortgage counseling around the country to help families avoid foreclosure and stay in their homes. Senator Casey also announced a drive to educate nonprofits in Pennsylvania about the availability of and the need to apply for these funds.
“The mortgage crisis is threatening the American Dream for too many families and hurting our economy,” said Senator Casey. “This mortgage counseling assistance will help keep families in their homes and help to stabilize our neighborhoods and economy.”
The $180 million initially supported by Senator Casey, Senator Chuck Shumer (D-NY) and Senator Sherrod Brown (D-OH) was signed into law in December as part of the Consolidated Appropriations bill. The national NeighborWorks America is responsible for distributing the $180 million in funds to non-profits throughout the country.
To ensure that non-profits are aware of the available funds and that they submit their application prior to the deadlines, Senator Casey is sending letters to eligible organizations in Pennsylvania.
These funds will be used by non-profit foreclosure prevention programs to provide counseling to those at risk of losing their homes. With more homeowners hit by the subprime crisis, demand for counseling has increased dramatically. Non-profits are in need of more funds and resources to provide counseling to those in need, the Senator said.
Steven J. Tuminaro, director, public policy and legislative affairs for NeighborWorks America told the Pittsburgh Tribune-Review, "The whole issue of foreclosures is somewhat daunting and confusing for an individual borrower. By training the counselors and making sure they are fully aware of all of the various remedies, we think appropriate help can be brought to save thousands and thousands of families that would otherwise be facing foreclosure."
He estimated that as many as 75,000 to 100,000 families nationwide could receive counseling as a result of the program.
An estimated two million families are at risk of losing their homes to foreclosure over the next two years as their subprime loans reset to higher, unaffordable rates.
Counseling programs have a demonstrated track record of helping homeowners navigate the complicated process of contacting lenders, banks and legal services to modify their mortgage loans and ultimately save their homes from foreclosure.
Senator Casey has been at the forefront of the congressional response to the subprime mortgage crisis. In addition to the $180 million secured by Senator Casey, Senator Schumer and Senator Brown, the trio also introduced the first major legislation to deal with the crisis. The Borrower’s Protection Act will provide funds for foreclosure prevention and crack down on bad actors in the mortgage industry and regulate mortgage brokers.
Senator Casey is also a cosponsor of the Homeownership Preservation and Protection Act introduced by Banking Committee Chairman Senator Chris Dodd. This legislation would help put an end to abusive practices and would provide stronger enforcement to ensure these new protections are followed.
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About NeighborWorks America
NeighborWorks America creates opportunities for people to improve their lives and strengthen their communities by providing access to homeownership and to safe and affordable rental housing. To date, we have assisted nearly 850,000 low- to moderate-income families with their housing needs. Much of our success is achieved through our support of the NeighborWorks network ― more than 230 community development organizations working in 4,400 urban, suburban and rural communities in all 50 states, the District of Columbia and Puerto Rico. In the last five years, NeighborWorks organizations have generated more than $12.4 billion in reinvestment in these communities. NeighborWorks America is the nation’s leading trainer of community development and affordable housing professionals.
