One of MortgageKeeper’s long-time clients is the Homeownership Preservation Foundation (HPF)–the folks behind the national Homeowner’s HOPE hotline, 888-995-HOPE. Their counselors have fielded more than 6 million homeowner calls since 2007, and 70% of these callers are still in their homes a year after their call. Amazing results!
They also have their finger on the pulse of the housing crisis, so we recently talked with Josh Fuhrman, HPF’s Senior Vice President, Government and Community Relations. Josh has been in the counseling industry for more than 15 years, and is currently a board member of the Consumer Advisory Council for the Federal Reserve.
While we still operate our 24/7 HOPE Hotline for foreclosure prevention counseling, we’re also developing several other exciting initiatives that will extend beyond helping homeowners in crisis and address a greater range of financial issues common among consumers. In conjunction with various lenders, we’ve introduced pre-purchase counseling and education, which helps people better understand the mortgage process before buying a home; we’re also working with several banks on post-modification counseling, which caters to homeowners who have already been approved for a trial loan modification but who now need help managing their other financial obligations to ensure their modification becomes permanent and that they become long-term, sustainable homeowners.
Economists see the housing crisis easing, but conversely MortgageKeeper is seeing an uptick in the need for our services. Is HPF finding this true as well?
2012 was the fifth consecutive year that HPF received over one million calls, and we continue to receive a high volume of calls, upwards of 4,000 daily, from distressed homeowners looking for financial guidance. Unfortunately, foreclosures are still occurring at levels that are three times what they were pre-crisis, and foreclosure activity is actually increasing in several pockets around the country. It was just recently reported that over ten million homeowners are still “underwater” on their mortgages, or owe more on their mortgage than what their home is currently worth. Looking at just those in foreclosure or underwater, we see 14 million Americans who could potentially benefit from HPF’s foreclosure prevention counseling.
What are the main changes you expect to see in the housing market in 2013?
We expect that there will be an increase in foreclosures over the next year due to lenders learning to comply with new standards set in motion by the various servicing regulations. What we want consumers to know is that, even if it is impossible to retain your home, there are alternatives to foreclosure that allow for a graceful exit. These include short sales, in which the bank agrees to sell a home for less than it’s worth, or a deed in lieu, in which a homeowner agrees to give the deed back to the lender. Both of these alternatives have less negative effects on your credit score and give homeowners a chance to prepare for what’s ahead rather than face the anxiety and fear associated with waiting for an eviction notice.
What barriers do you see to relief in the housing market?
There is still a lack of awareness about the positive impact of housing counseling among consumers, as well as a general sense of distrust in the mortgage lending industry. This is an unfortunate combination, because housing counseling is the tool that can once again bring the sense of trust back into the homeownership process. Looking beyond the housing crisis, HPF’s goal is to make sure that housing counseling is always available as an option for homeowners at any stage of the process, whether they are first-time buyers trying to figure out what they can afford or homeowners who fear they may not be able to make their next payment. Having a third-party ally has been proven to help in both of those situations.