Demand for counseling funds far exceeds supply
Washington, DC – NeighborWorks America today announced that $63.1 million has been awarded to 29 state housing finance agencies (HFAs), 18 HUD-approved housing counseling intermediaries, and 67 community-based NeighborWorks organizations to provide counseling to families and individuals facing the threat of foreclosure. Although the number of new households facing foreclosure is below the peak seen just a few years ago, many hundreds of thousands of homeowners will still face trouble with their mortgages this year. The foreclosure prevention work done by housing counselors funded by the NFMC program will significantly help these families. It is estimated that more than 167,800 families facing the threat of foreclosure will be directly assisted with this eighth round of NFMC funding.
The extent of the foreclosure crisis is evident by the strong request for NFMC funding from the housing counseling community. Demand for NFMC grant funds was in excess of $100 million.
In total, more than 1,100 nonprofit counseling agencies and local NeighborWorks organizations across the country are expected to be engaged in the NFMC Program as a result of these awards. These organizations provide invaluable, free assistance to families at risk of losing their homes, determine homeowner eligibility for the various state and federal foreclosure prevention assistance programs, help homeowners understand the complex foreclosure process, and identify possible courses of action so their homeowner clients can make informed decisions and take action.
In addition to the families directly helped by counselors funded through the NFMC program, many more will be helped by the training of foreclosure counselors, provided through the NFMC Program. NeighborWorks expects to train 2,000 counselors with this round of NFMC funding.
NFMC foreclosure prevention funding supports counseling that helps families through the long and complicated foreclosure process. NeighborWorks America believes that a number of these families might not have fallen into foreclosure if they had the benefit of NeighborWorks pre-purchase housing counseling and education prior to becoming homeowners.
Research conducted for NeighborWorks America on the effectiveness of NeighborWorks pre-purchase housing counseling and education found an average 33 percent decline in serious mortgage delinquency for homeowners who received NeighborWorks pre-purchase guidance compared to similar homeowners who didn’t receive the same NeighborWorks pre-purchase help. The full research can be found at http://www.nw.org/network/newsroom/documents/ExperianMayer_ReportExecSummary.pdf
About NeighborWorks America
For 35 years, NeighborWorks America has created opportunities for people to improve their lives and strengthen their communities by providing access to homeownership and to safe and affordable rental housing. In the last five years, NeighborWorks organizations have generated more than $19.5 billion in reinvestment in these communities. NeighborWorks America is the nation’s leading trainer of community development and affordable housing professionals.