March 28, 2008
Contact: Doug Robinson
202-220-2360
drobinson@nw.org

New Jersey Homeowners Avoid Foreclosure Through
Elizabeth, New Jersey-Based Brand New Day, Inc.

Just One Example of the NeighborWorks Network Efforts to Prevent Foreclosure

Elizabeth, NJ – Brand New Day, a member of the national NeighborWorks network, said today that families struggling to avoid foreclosure must take the first step and reach out for help from certified housing counseling organizations with proven track records of helping homeowners secure loan modification and other foreclosure alternatives with lenders.

President Bush, above, shakes hands with homeowner Danny Scott Cerchiaro during a visit to Novadebt. Next to the president is homeowner Theresa Torres. At right, Penny Meredith of Brand New Day, a New Jersey NeighborWorks organization.

“It’s important now more than ever that homeowners facing a mortgage crisis turn to a certified housing counselor that has their best interest in mind first,” said Krishna Garlic, executive director of Brand New Day. “There are many clever schemes in the market today designed to take advantage of homeowners under stress, effectively making the situation worse. Non-profit housing counselors who have been in the community for years can help. But first a homeowner has to come through the door.”

Garlic explained that her organization recently helped a self-employed homeowner whose adjustable rate mortgage climbed to an unaffordable rate at the same time that his business slowed down. Unable to refinance due to the credit crunch and because loans to self-employed borrowers are difficult in even the best of times, the homeowner was at wits end.

“But one our counselors worked with him over the course of two months to put together a compelling package of financial documents showing his creditworthiness to his lender and the result was a very affordable loan modification,” said Garlic.

Penny Meredith, a community education coordinator at Brand New Day, and the homeowner today participated in a press conference in Freehold, NJ with President Bush where he highlighted the successful partnership between non-profit housing counseling intermediaries and lenders in the effort to prevent foreclosure.

The majority of the more than 230 NeighborWorks organizations around the country are helping homeowners achieve affordable loan modifications and refinances so that foreclosure can be avoided.

“The non-profit community is responding in a variety of ways to help qualifying homeowners avoid foreclosure,” said Marietta Rodriguez, national director of Homeownership Programs at NeighborWorks America. “Sometimes to prevent foreclosure homeowners needs better budgeting; sometimes they need a small amount of ‘rescue funds; sometimes they need a third-party to help them talk to and resolve the issue with the lender. Community groups are the best first source for homeowners no matter their mortgage situation.”

And while lender outreach efforts to homeowners in mortgage trouble have increased significantly in recent months, Rodriguez notes that kind of outreach can not replace the “on-the-ground, face-to-face work of non-profit organizations.”

“In fact, we’re seeing homeowners grow increasingly distrustful of the lending community,” said Rodriguez. “But reputable lenders are part of the solution and the bridge over the gap between them and homeowners is the non-profit organization.”

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.