June 15, 2009
Contact:
Douglas Robinson, 202-220-2360, drobinson@nw.org
Erin Angell Collins, 202-220-6317, ecollins@nw.org
National Foreclosure Mitigation Counseling Program Helps More than 400,000
More than Ninety Percent of Homeowners Receiving Counseling Still in Their Home
Washington, DC – NeighborWorks® America, the administrator of the Congressionally authorized National Foreclosure Mitigation Counseling (NFMC) program, today announced that through May 31, 2009 more than 405,000 homeowners have received foreclosure prevention counseling as a result of NFMC funding, providing families much needed information, assistance and guidance to address their risk of foreclosure s, helping these families move toward finding a solution to foreclosure.
The report found that more than 90 percent of homeowners receiving counseling were still in their homes as of February 2009, although 18 percent of those families had a foreclosure process started. Six percent of families counseled had a foreclosure completed and another 3 percent had their mortgage paid off through a refinance, short-sale, or deed-in-lieu. Importantly, the report noted that lower-income homeowners are likely to have a greater rate of foreclosure starts than higher-income homeowners.
A major determinant of whether a foreclosure start is initiated is when financially distressed homeowners seek counseling services. Homeowners who seek assistance before their mortgage is seriously delinquent fare better than those who seek assistance later. According to the NeighborWorks America NFMC report, 27 percent of clients whose mortgages were three to four months delinquent at intake either had a foreclosure started or completed, compared to 60 percent of clients whose mortgage was more than four months delinquent at intake.
NFMC Service to Minorities
Approximately 53 percent percent of households who received counseling through the NFMC program were minority, and 67 percent of the families helped had household incomes at or below 80 percent of the median income in their area. The data are based on reports from more than 1,700 agencies that receive funding through NFMC.
“The NFMC program clearly is reaching the homeowners who have been hardest hit by this housing crisis,” said Ken Wade, CEO of NeighborWorks America. “Thanks to the hard work and creative outreach efforts of a diverse group of non profit organizations around the country, and the expertise of their certified counselors, hundreds of thousands of families are better informed about their options to avoid home foreclosure.”
The NFMC program is positively affecting the lives of real people like Roseline, of Greenville, North Carolina. Roseline is a single-mother with a son who had done everything right and was doing well until she lost her job and medical bills mounted. Faced with foreclosure, Roseline contacted Mission of Peace, an NFMC grantee that helped her obtain a loan modification, reducing her monthly mortgage payments substantially.
A similar outcome was experienced by Martha, a computer sales rep who had been working long overtime hours to keep up with her mortgage following a divorce. But when the overtime stopped, the money did also, and the delinquency and foreclosure notices began.
After months of worry, Martha finally called Neighborhood Housing Services of Phoenix, another grantee of the NFMC program and a member of the NeighborWorks® network.
Martha said that the counselor “gave me nothing but hope.” In the end, Martha had her hope realized when with the help of her foreclosure prevention counselor her total mortgage payments were reduced by $800 or 42 percent.
“I’m in heaven now,” Martha said. “I can keep my house without working seven days a week. Now I can pay the bills when they’re due.”
“The NFMC program is making a real difference in the lives of hundreds of thousands of families at risk of foreclosure,” explained Wade.
For more information about the National Foreclosure Mitigation Counseling program, visit www.nw.org/nfmc. Homeowners can locate a NFMC-funded counseling agency by visiting www.findaforeclosurecounselor.org.
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.Since 1991, we have assisted nearly 1.2 million 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 more than 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 $15 billion in reinvestment in these communities. NeighborWorks America is the nation’s leading trainer of community development and affordable housing professionals.
