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| Effort Launched to Reduce Foreclosures in Ohio |
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More than 150 public, corporate, and nonprofit officials gathered this month to discuss and begin implementing strategies to address the rapidly increasing rate of home loan foreclosures in Ohio. The forum was sponsored by the Federal Reserve Bank of Cleveland and Neighborhood Reinvestment Corporation.
According to a September 2004 report from the Mortgage Bankers Association of America, Ohio has the highest percentage in the nation — 65 percent higher than the national average — of homeowners in foreclosure or with mortgage payments that are 90 days or more past due.
With the recent explosion of subprime and predatory lending, as well as the overall increase in homebuying at prices that are outpacing increases in income, many industry experts predict the rate of foreclosures will rise nationwide.
View article.
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| President's Budget Calls for Cuts in HUD and Other Housing and Development Programs |
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The White House released its Fiscal Year 2006 budget proposing significant decreases in many community development-related programs. The President proposes $28.5 billion for the entire HUD budget, an 11.5 percent cut from FY05 levels. Under the President's plan, Neighborhood Reinvestment Corporation is proposed at $118 million, an increase of $3 million over last year's proposed amount.
Tenant-based Section 8 is proposed for a $1 billion increase
to approximately $18.4 billion or 65 percent of the Department's overall budget.
Project-based Section 8 is slated for a reduction; HOPE VI is proposed to be eliminated; Disabled Housing (Section 811) would be reduced by 50 percent; CDBG would be reduced by 50 percent and transferred to the Department of Commerce as part of the "Strengthening America's Communities Grant Program;" USDA Section 515 would be reduced by over 60 percent; CDFI would be reduced from $54 million to $8 million; SBA's Microloan program would be eliminated; the SBA's 7(a) loan program would be eliminated.
To view the entire budget, click here. For more analysis of this or any other breaking policy news, please contact Michael Butchko at mbutchko@nw.org or 202-220-2362.
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| Community
Strategies represents the shared experience of the NeighborWorks
network and Neighborhood Reinvestment Corporation in various topics
of community development and affordable housing. |
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| The
NeighborWorks Training
Institute is dedicated to providing the highest quality training
for community development practitioners. Learn about the latest
classes and symposia on leading-edge topics. |
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| Neighborhood
Reinvestment, working closely with members of the NeighborWorks
network and partners, produces a wide-variety of publications. Most
are free and others cost a nominal fee to order. For a complete
listing and order forms, go to NeighborWorks Publications. |
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| Find lists
and charts on Neighborhood Reinvestment and the NeighborWorks
network organizations. |
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| “Why Counseling is Important” by Kenneth Wade, Neighborhood Reinvestment CEO |
Kenneth Wade, the chief executive officer of Neighborhood Reinvestment, has written an opinion piece in Origination News, a leading publication for mortgage brokers, on what he sees as the value of providing education and counseling as part of the loan origination process. Wade writes: “First, comprehensive education programs are an
excellent source of potential new customers. Families who thought buying a house was impossible, can now understand how to make it a reality. Quality counseling programs can reduce lender costs as they perform pre-screening functions and bring more mortgage-ready consumers to the table. And fewer late payments and defaults cut
costs and losses substantially.
View opinion article. [PDF]
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| NeighborWorks Marked Valentines Day with "Odes to Abodes" |
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While many celebrated Valentines Day with chocolates and roses, the NeighborWorks network marked the occasion with “Odes to Abodes” — a listing of some of the most sentimental housing transactions in the national network of more than 235 nonprofit housing organizations.
“The ties that bind a new homeowner and his or her family to their new home and neighborhood are truly worthy of celebration this Valentines Day,” said Neighborhood Reinvestment Corporation CEO Kenneth Wade. “Homeownership not only warms our hearts, it helps families get ahead financially. American homeowners during the past year have increased their net worth with $8 trillion in home equity. We know that low-income homeowners had a net worth 12 times that of renters at the same income level.”
The series of heartwarming housing stories, which features residents in Arizona, California, Florida, Georgia, Vermont, and West Virginia, can be found at www.nw.org/newsroom.
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NeighborWorks Group Dedicates Affordable Apartments In Maryland Suburb
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The Washington Times reported that Montgomery County officials dedicated the Pembridge Square Apartments last week in Wheaton, Maryland. The apartments were renovated from a 50-year-old rental housing property by the Montgomery Housing Partnership, a NeighborWorks network member. The nonprofit group rebuilds run-down properties, then rents them to low-income residents. The $18 million purchase and renovation project was funded by grants and loans from the state of Maryland, Montgomery County Department of Housing and Community Affairs and Neighborhood Reinvestment Corporation.
The work included renovating 133 units with new kitchens, bathrooms, carpeting, windows, security and heating systems at an average of $40,000 per unit.
"This neighborhood in Montgomery County is experiencing rapid gentrification due largely to its proximity to a Metrorail station with direct access to downtown Washington, D.C.," said Robert Goldman, Montgomery Housing Partnership president. "The opening of Pembridge Square Apartments will help ensure that our low- and middle-income neighbors are not pushed out of the community." View article.
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| NeighborWorks Insurance Alliance: Bringing Insurance Education to Urban Markets |
The NeighborWorks Insurance Alliance was recently featured in Best's Review for bringing insurance education to urban markets. The Alliance provides grants and corporate support to amplify insurance education efforts in St. Louis, Chicago, Staten Island, New York, and Richmond, Virginia. "We see more affordable and accessible insurance products created to suit community needs, and insurers are lessening their losses in each city," said Todd Pittman, director of the Alliance. View article. [PDF]
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| Changing Demographics Point to Rise in Multifamily Housing, Says Columnist |
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Building industry consultant and columnist John Burns believes multifamily housing is about to break out of the doldrums afflicting that sector for the last decade. "Due to changing demographics, and a multitude of psychographic trends, there will be a world of opportunity for multifamily builders over the next few years," Burns says in an article in Professional Builder.
What's driving the change?
The number of people in their early 20s has been declining for a decade, but it's about to surge as the "echo boom" generation arrives. Today, there are 19.7 million Americans aged 21 to 25 with 20.4 million in the group aged 16 to 20. Demand for entry-level apartments will grow over the next five years, he says. View article on KnowledgePlex.
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| 'Explosion of Subprime' Lending in California |
| Today the lines between prime and subprime are blurring as more lenders take aim at borrowers who don't fit the rigid mold of prime mortgages. That allows more people to buy their first house or spend more than they otherwise could, reports The Sacramento Bee. Total subprime lending of $197 billion in California last year was more than double the 2003 total. In Sacramento, Placer and El Dorado counties combined, total subprime lending nearly doubled to $11.3 billion. A University of North Carolina, Chapel Hill, study released last month found that subprime prepayment penalties and balloon payments put borrowers at greater risk of foreclosure. (See information below under "Resources.") View article. |
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| OCC Sets New Predatory Lending Protections for Residential Real Estate |
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The Office of the Comptroller of the Currency (OCC) today issued residential real estate lending standards as an additional step to protect against national banks becoming involved in predatory, abusive, unfair, or deceptive residential mortgage lending practices.
"The OCC is committed to ensuring that abusive lending practices do not gain a foothold in the national banking system," said Julie L. Williams, acting Comptroller of the Currency.
The new guidelines incorporate key provisions and central principles of the OCC's February 2003 advisory letters alerting national banks to practices that may be considered predatory or abusive and advising national banks on measures to avoid such practices. The advisories addressed national banks' mortgage origination activity, as well as purchases of loans and use of third-party brokers to conduct mortgage lending. National banks are expected to implement anti-predatory lending standards consistent with and appropriate to the size and complexity of the bank and the nature and size of its lending activities. View news release.
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| Twenty Agencies Represented at Financial Literacy and Education Commission Meeting |
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This month, Treasury Assistant Secretary for Financial Institutions Wayne Abernathy opened the fourth meeting of the Financial Literacy and Education Commission. Abernathy welcomed Commission representatives and thanked them for their hard work in establishing a national financial education toll-free hotline and Web site, as well as for working toward the development of the first-ever national strategy for financial education. Comptroller of the Currency Julie Williams, a Neighborhood Reinvestment board member, was among the government officials to attend the meeting.
"I'd like to commend the 20 agencies represented here for the continued commitment each has demonstrated to improving financial education, and in particular for successfully launching www.mymoney.gov and the 1-888-mymoney toll-free hotline," said Abernathy.
Many comment letters suggested a successful program should focus on starting financial education early.
Some called for financial education as a high school graduation requirement.
"We need to start at the elementary level and educate young students with the very basics and continue to grow on that throughout their school years," commented Jodi Mitchell of Mountain America Credit Union in Salt Lake City. View news release.
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| Sustainable Design Assessment Team (SDAT) Program, March 14 |
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The American Institute of Architects’ Center for Communities by Design
announced the Sustainable Design Assessment Team (SDAT) Program for 2005. This
community assistance program focuses on the principles of sustainability. SDATs will
bring a team of professionals (such as architects, urban designers, planners, hydrologists,
economists, attorneys, and others) to work with community decision-makers and
stakeholders to help them develop a vision and framework for a sustainable future.
The institute is seeking applications for this year’s program. The AIA will fund
$20,000 of each program and each community will contribute approximately $10,000 to
$20,000. Beginning in late 2005, the Center will seek proposals from communities
interested in participating in 2006. Information and application forms are available at
www.aia.org/liv_sdat. Questions about the application should be directed to alivingston@aia.org.
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| HAC Green Grants Program, March 15 |
| The Housing Assistance Council announced its new small grants program for nonprofits involved in green building/healthy homes. Supported by the Home Depot Foundation, the competition was announced via the HAC Web site. Visit www.ruralhome.org for more information and an application. Applications are due to HAC by March 15, 2005. |
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| Mattel Grants, April 8 |
| Mattel is offering grants in the range of $5,000 to $25,000 to programs that directly serve children in need, and “creatively address a locally defined need.” Learn more. |
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| Innovations in Manufactured Homes, April 15 |
| This month CFED announced the launch of a multi-year, multi-million dollar initiative, Innovations in Manufactured Homes (I'M HOME). As part of this initiative, CFED is soliciting proposals from organizations seeking to address barriers to asset-building that face the nearly nine million American families currently living in manufactured homes. Successful applicants will be awarded either implementation grants of $150,000 or catalyst grants of $50,000. Deadline for a concept paper, the first step in the application process, is April 15.
For additional information, as well as the RFP, click here. |
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| NeighborWorks Training Institute, Minneapolis, April 22, 2005 |
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Neighborhood Reinvestment Corporation will hold its NeighborWorks Training Institute April 18-22 in Minneapolis. The institute will feature more than 70 courses in affordable housing and community development, including a Spanish-language course on Homebuyer Education Methods, and other events, such as a luncheon with Richard Lord, author of American Nightmare: Predatory Lending and the Foreclosure of the American Dream. On April 20, Neighborhood Reinvestment will host a daylong symposium on navigating social dynamics in gentrifying neighborhoods. Registrations received by March 8 qualify for the early registration fee. For more information or to register, click here.
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| Promises & Pitfalls: As Consumer Finance Options Multiply, Who is Being Served and at What Cost? Washington, D.C. April 7-8, 2005 |
| The Community Affairs office of the Federal Reserve System will be holding its fourth biennial research conference on consumer finance. Consumer financial markets channel trillions of dollars of credit to households of varying income levels through a wide range of intermediaries that operate in many markets. How efficiently do these markets operate, and how well are consumers' needs being met? This conference will bring together a diverse audience from academia, financial institutions, community organizations, foundations and government to learn about current research on consumer finance. The conference keynote speaker is Alan Greenspan, chairman of the Board of Governors of the Federal Reserve System. Topics will include evaluations of trends in consumer finance; household financial products and services; consumer financial service providers and markets; consumer debt burdens; loan foreclosures and bankruptcies; behavioral economics and consumer financial decision-making; credit bureaus and credit-scoring models; fair and equal access to credit; and financial literacy and predatory lending. For more information or to register, click here. |
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| New Study Links Predatory Lending Practices to Foreclosures |
| The University of North Carolina at Chapel Hill released a report last month that examines the relationship between abusive loan terms
and foreclosure. Findings suggest that predatory loans have the potential not only to erode
household wealth but also to heighten the negative impacts on individuals, households, and
communities associated with foreclosure. View report [PDF] |
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| Florida Housing Recovery Efforts |
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Florida has been pummeled by consecutive hurricanes in the past few months, requiring disaster-relief activity statewide. This special report focuses on organizations that are significantly involved in responding to the disaster, including NeighborWorks organization Centro Campesino Farmworker Center. This report describes the organizations' plans and current efforts, as well as providing recent news and general disaster information. View report on KnowledgePlex.
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| New Resource for Those Working with Prisoners Returning to Communities |
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A new report from the Council of State Governments' Re-Entry Policy Council recommends ways to improve the likelihood that adults released from prison will avoid crime and become productive members of their communities. The report addresses issues related to public safety, health, substance abuse, housing, employment, children and families, and victims. The authors encourage corrections officials to work with public health workers, housing providers, state legislators, and workforce development staff. To access the report, click here.
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| The Heart of the Matter: Designing a Great Interior |
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Ultimately a home’s interior is at the heart of a good design: once your residents get inside the front door, they are truly “home.” So it’s important to get the room relationships and room design right, but it is also important to develop at least a few different “right” configurations that will work for the many different people who will be living in your affordable housing development. Just as different neighborhood contexts call for different design approaches outside, the units themselves will need to be different inside for seniors than they will for families, and different supportive services will require different types of rooms and different spatial arrangements. This design update discusses some of the principles of unit design and introduces an important and useful tool that will help you as you seek input from future residents and other members of the design team while designing your next affordable housing development. View.
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