October 21, 2008
HUD ANNOUNCES FUNDING TO HELP SPRINGFIELD AREA FAMILIES FIND OR KEEP HOMES
Funding is critical to foreclosure prevention
Today, U.S. Department of Housing and Urban Development Regional Director Taylor Caswell announced that nearly $50,000 in funding has been awarded to Springfield Partners for Community Action to help families and individuals
find or keep homes.
The grant, part of $50 million nationwide and $4.2 million awarded in Massachusetts, is being provided under HUD's Housing Counseling Program, which provides funding to help local agencies assist families in becoming first-time homebuyers by helping them to realistically evaluate their readiness for a home purchase, understand their financing and downpayment options, and navigate what can be an extremely confusing and difficult process. Housing
counseling agencies also provide assistance to homeowners who are facing mortgage delinquency and default, and assist homeless families and individuals.
"The value of housing counseling cannot be overstated," said Caswell. "Housing education programs offered by Springfield Partners for Community Action and other HUD-certified housing counseling agencies help put families into the right home, and help keep them there. Getting the correct information at the beginning of the process will help families avoid mortgage troubles later on."
Springfield Partners for Community Action is a private, non-profit organization that assists low-income individuals
and families with becoming self-sufficient. Over the past year, the agency has provided homeownership education
to 275 people.
In response to an unmet need identified by the Housing Court of Hampden County, and the increasing number of tenants displaced due to foreclosure, Springfield Partners has recently expanded its relocation/housing search assistance to include an eviction clinic. The goals are to ensure tenants are educated and informed of their rights
and responsibilities and are prepared when going to court. Additionally, through this critical partnership with the housing court, Springfield Partners for Community Action is able to identify tenants residing in foreclosed properties and establish immediate contact to make tenants aware of their rights.
Paul Bailey, Executive Director at Springfield Partners says, "We have always tried to prepare our clients for the realities of homeownership through our housing counseling program. Like other agencies, we have also seen an increase in the number of people looking for help with foreclosure. We are pleased to continue our work with HUD
to provide assistance to the many families who come through our doors looking for help with housing issues".
This year with foreclosures on the rise, HUD is emphasizing the importance of housing counseling services more
than ever. The organizations that provide housing counseling services help people become or remain homeowners
or find rental housing, and assist homeless persons in finding the transitional housing they need to move toward a permanent place to live.
In addition, many housing counselors help combat predatory lending by helping unwary borrowers avoid
unreasonably high interest rates, inflated appraisals, unaffordable repayment terms, and other conditions that can result in a loss of equity, increased debt, default, and even foreclosure. Likewise, foreclosure prevention counseling helps homeowners facing delinquency or default employ strategies, including expense reduction, negotiation with lenders, and loss mitigation, to avoid foreclosure.
HUD awards annual grants under the housing counseling program through a competitive application process.
In addition to housing counseling, HUD has other programs to help struggling homeowners avoid foreclosure:
FHA Secure, which is administered by the Federal Housing Administration, the branch of HUD that insures mortgages against default, is targeted toward homeowners with strong credit histories who had been making timely mortgage payments before their adjustable loans reset to higher rates. Under the program, which was implemented in September, 2007, eligible homeowners are required to meet strict underwriting guidelines and pay a mortgage insurance premium. Since the program's inception, more than 4,400 mortgages in Massachusetts have been refinanced into fixed FHA-insured mortgages.
Hope for Homeowners is a program that was announced earlier this month that expands on FHA Secure. The program provides new, 30-year fixed rate mortgages at the current appraised value of the home. It will help struggling homeowners refinance their mortgage into a more affordable payment.
For more information on homeownership and foreclosure prevention programs, please contact a HUD-certified
housing counseling agency.