Foreclosure Mitigation Steps
Step Two: Reach Troubled HomeownersStep Three: Establish Post-Foreclosure Support Systems
Reach Troubled Homeowners
Surveys show many at-risk homeowners often fail to seek help. They may be embarrassed or don't know where to turn. Stress can make dealing with credit problems even harder. Community leaders serve a crucial role by helping consumers find quality housing counselors at the first sign of trouble.
The U.S. Department of Housing and Urban Development (HUD) maintains a database of HUD-approved counseling agencies. Additional information, including financing options, can be obtained from the Federal Housing Administration.
One important way to strengthen foreclosure outreach is to build strong partnerships with existing state and local coalitions and task forces.
If there are no existing coalitions or task forces in your area, you can start one by reaching out to grassroots and faith-based groups, legal aid offices, housing counseling organizations, community development organizations, and city and state consumer protection departments. Good examples of state coalitions include:
- Texas Foreclosure Prevention Task Force
- Colorado Foreclosure Prevention Task Force
- Missouri Homeownership Preservation Network
Homeowner workshops and/or default clinics have proven successful in helping borrowers avoid foreclosure. They are held in accessible community locations such as convention centers, schools and public libraries. Sponsors invite troubled borrowers, issue media releases and post notices on websites and in public places.
Three basic models exist for effectively run workshops. They range from large events at which loan servicers and housing counselors meet face-to-face with borrowers to smaller events that are primarily educational in purpose.
- HOPE NOW Homeowner Preservation Workshops are typically held in large metro areas. They benefit from a national partnership with NeighborWorks America and an alliance with more than 25 lenders to allow borrowers to meet with loan servicers and housing counselors.
- Community Foreclosure Mitigation Workshops are typically hosted by a local coalition or task force. Local nonprofit counselors are on site to counsel borrowers. Lenders and servicers are often willing to participate in community events that are well-designed and marketed.
- Default Clinics are hosted by nonprofit credit and/or housing counselors as a way to triage distressed borrowers and streamline the default counselors' time. This model focuses on getting information to clients quickly to help them select the appropriate assistance needed.
Reach Out to Consumers
Community leaders are employing many direct approaches to reach troubled homeowners, making use of information and materials available from local and national organizations:
Public Service Announcements (PSAs)Foreclosure Help and Hope is a PSA campaign created by NeighborWorks America, the Homeownership Preservation Foundation and the AD Council.
- Loan Modification Scam Alert is an anti-foreclosure scam toolkit created by NeighborWorks America.
- 5 Tips for Avoiding Foreclosure Scams provides consumer help from the Federal Reserve.
- Money Matters includes video PSAs from the Federal Trade Commission.
- Foreclosure Prevention offers radio scripts and PSAs on housing issues from the Comptroller of the Currency.
- Practical Tips for Avoiding Foreclosure is a sample local brochure based on information from HUD.
- Foreclosure prevention from Greenville County Human Relations, 2009.
Mailings, Flyers and Press ReleasesForeclosure Hotline Card created for the Colorado Foreclosure Hotline
Local Community Partnership websites
Public Television Partnerships
- Weathering the Financial Storm
- Facing the Mortgage Crisis
St. Louis' KETC/Channel 9, the area's public television station, has been joined by 26 community partners to connect people at financial risk to the resources they need. This collaborative community effort is raising awareness of the impact of the financial crisis in the St. Louis region and helping individuals manage their financial challenges through on-air, online and personal assistance.
Access National Resources
A number of national organizations and government agencies maintain rich informational websites to assist communities and consumers in dealing with foreclosure issues, including prevention, mitigation, counseling, loan modifications, neighborhood stabilization and foreclosure-rescue scams.
Enterprise Community Partners: Is a national nonprofit with more than 25 years of experience in the community development and affordable housing field.
Local Initiatives Support Corporation: Is a national nonprofit that helps local organizations access national resources and expertise.
NeighborWorks America: Was created by Congress to provide financial support, technical assistance and training for community-based revitalization efforts. It supports a wide range of programs:
- The Center for Foreclosure Solutions provides information that helps counselors and community leaders connect with and advise troubled homeowners.
- The National Foreclosure Mitigation Counseling Program (NFMCP) provides grants to HUD-approved counseling intermediaries to expand their capacity to counsel at-risk borrowers.
- The NeighborWorks Center for Homeownership Education & Counseling works through the NeighborWorks Training institutes to provide regional and place-based trainings.
- Foreclosure Basics e-learning course, an online educational resource.
The Homeownership Preservation Foundation: Provides information and videos that explain alternatives to foreclosure and operates a national hotline-888-995-Hope (4673)-available in both English and Spanish. Callers can be referred to local nonprofit counseling assistance.
HOPE NOW Alliance: Is a national alliance of more than 50 lenders, loan servicers and counseling organizations dedicated to preserving homeownership and minimizing foreclosures.
- HOPE NOW members have agreed to a uniform set of procedures and guidelines to increase outreach to borrowers.
- HOPE NOW also partners with NeighborWorks America to conduct homeowner workshops.
Making Home Affordable: The Obama administration has introduced a comprehensive Financial Stability Plan to address problems at the heart of the crisis and help make monthly mortgage payments more affordable for troubled homeowners.
Office of the Comptroller of the Currency: Provides consumer and community information and includes sample public service announcements for radio.
The Federal Deposit Insurance Corporation (FDIC): Provides consumers and community foreclosure assistance and links to foreclosure rescue and loan modification scam awareness resources.
The Federal Reserve Board of Governors: Provides foreclosure-help resources to both consumers and communities. It also connects with all 12 Federal Reserve Banks.
U.S. Department of Housing and Urban Development: Provides links to consumer resources, government programs and government-approved, nonprofit counseling agencies.
Identify Foreclosure Alternatives
Identifying and understanding the alternatives to foreclosure can help prevent problems before they occur or significantly reduce the pain. The government implemented a major program in 2009 to encourage loan modifications. Local housing counselors are good sources for helping consumers find options. Just understanding the different terms can guide consumers to the right course of action.
Renters Rights Information from the National Loan Income Housing Coalition
Foreclosure Rescue/Loan-Modification Scams
- NeighborWorks Loan-Modification-Scam Alert
- Federal Reserve Foreclosure-Scam-Prevention Site
- Federal Trade Commission Foreclosure-Scam-Prevention Site
- Prevent Loan Scams, a partnership of federal, state and nonprofit groups