States, Cities Offering Mortgage Counseling and Refinancing
Arizona Gov. Janet Napolitano (D) recently announced a local toll-free helpline for families that have fallen behind on their mortgage payments and are facing the prospect of foreclosure.
Arizona had the third highest rate of foreclosure in the country for the first quarter of 2008, according to the Arizona Department of Housing (ADOH). With the initiative, Arizona joins cities and states across the country that are helping home owners avoid foreclosure during the housing downturn.
The Arizona Foreclosure Helpline, made possible by a $1.3 million grant, is the state’s latest response to the wave of foreclosures that is overwhelming families and threatening to slow the state’s economy. ADOH will manage the helpline.
People who call the toll-free number, 877-448-1211, will be directed to the counseling agency closest to their home. Twelve foreclosure counseling organizations have agreed to be a part of the program and 60 professional foreclosure counselors have been trained for it through the nonprofit NeighborWorks Center for Foreclosure Solutions.
Most states, and many cities, have stepped up their counseling services to families struggling to make their mortgage payments. Families that receive such services and talk with their lenders are much more likely to benefit and have a good outcome than families who do not seek help.
The following is a list of state and local governments that offer mortgage counseling services and mortgage refinancing programs. They represent a fraction of the counseling services now available to home owners across the country:
Maryland offers state residents the Bridge to HOPE Loan Program, which provides gap financing.
Administered by the Maryland Department of Housing and Community Development’s Community Development Administration (CDA), the program provides Maryland home owners with short-term relief by preventing residential mortgage foreclosures of borrowers experiencing financial difficulty because of subprime or exotic mortgages such as a negative amortization loan or an adjustable rate mortgage (ARM) loan that has reset or is about to reset.
Last fall, Gov. M. Jodi Rell (R) unveiled CT FAMILIES, a $50 million program to help low- to moderate-income, first-time home owners at risk of foreclosure refinance to 30-year, fixed-rate loans at .25% above the Connecticut Housing Finance Authority (CHFA) rate. CHFA administers the program.
Last November, Gov. Rod Blagojevich (D) and the Illinois Housing Development Authority held the first of many Homeowner Outreach Days to connect potentially troubled borrowers with counseling and workshops on refinancing, foreclosure prevention, legal rights, loss mitigation and credit counseling. The first “outreach day” was held in Chicago. More will be conducted throughout the state through the end of the year.
Gov. Blagojevich also signed legislation strengthening lending standards for mortgage brokers — and requiring brokers to act in the borrower’s best interest — and enacted Illinois’ mandatory housing counseling pilot program.
Gov. Edward Rendell (D) introduced the state’s Homeowner Equity Recovery Opportunity (HERO) mortgage refinance program, which received funding from PNC Bank and the City of Philadelphia, to help troubled home owners refinance to fixed-rate mortgage loans.
Pennsylvania also offers the REfinance to an Affordable Loan program and the Homeowners’ Emergency Mortgage Assistance Program.
Gov. Jennifer Granholm (D) instructed the Michigan State Housing Development Authority to address the state’s mortgage foreclosure problem, resulting in the Save the Dream mortgage refinancing program for people struggling with adjustable rate mortgages and higher fixed-rate loans.
Boston has begun a multifaceted foreclosure prevention initiative focusing on foreclosure prevention and foreclosure intervention. The city is developing a foreclosure remediation component for the initiative as well.
Boston also developed an in-house foreclosure call center (617-635-HOME) to help home owners in trouble.
Minneapolis and its partners are offering a range of programs to address the foreclosure problem. One of the partnerships, the Minnesota Foreclosure Partners Council, established by the Family Housing Fund, is working to strengthen the housing market by addressing foreclosure at three stages ― pre-purchase, post-purchase and remediation.
In addition, the city is:
- Providing easy access to foreclosure counseling and assistance programs using Minneapolis 311
- Working with neighborhood organizations and developers to revitalize housing in areas hardest-hit by foreclosures
- Securing and maintaining vacant properties when foreclosures cannot be prevented until they are sold
- Investigating suspicious real estate practices and working with state, county and federal government officials to enforce Minnesota and federal laws.
For more information about these efforts — including mortgage assistance, impact fee relief, tax credit programs, infrastructure finance programs and regulatory relief initiatives — visit www.nahb.org/economicstimulus.