Prepared Remarks of Secretary Shaun Donovan at a Foreclosure Prevention and Housing Counseling Event

Refreshing Spring Church
Riverdale, Maryland
Thursday, August 5, 2010

Thank you, Majority Leader Hoyer, for that introduction and for your extraordinary leadership in Congress.

Whether it is leading the fight in the Congress to pass the Recovery Act, which has created 53,000 jobs in Maryland, or fighting for families day-in and day-out here in the 5th district, Majority Leader Hoyer has been a champion for this state and for homeowners throughout the country who need help.

Let me also thank Lisa Butler McDougal for her wonderful work as the head of SEED, as well as Marcia Griffin from HomeFree-USA and Donna Hurley of the Prince George's Homeownership Coalition for their commitment. Each of you reminds us why the vast network of housing counselors that HUD funds is one of our greatest strengths.

And lastly, let me thank Alphonso Moore -- who reminds us why that network is so important.

So many families, in Maryland and across the country, have felt the shock of the foreclosure crisis and the pain of losing a home. That's why, as part of our $87 million housing counseling budget, HUD announced just last week that $79 million is available for a broad range of housing counseling programs -- an increase of $21 million, or 36 percent, over last year.

Since April, 2009, HUD-approved mortgage counselors have assisted 3.6 million families. And I've seen for myself the difference these housing counselors can make in the lives of families.

Just last week in Atlanta, I met a woman who, with tears in her eyes, told me that her home was in foreclosure -- that despite assurances from her servicer that her home was safe, she was still receiving foreclosure letters.

Hers was the kind of story we've heard about time and again--families doing everything they can do the right thing--the responsible thing--only to find themselves overwhelmed by what is sometimes a daunting process.

But at HUD's Help for Homeowners event in Atlanta, she was able to sit down with a representative from her bank and a HUD-approved housing counselor. Together, they were able to work out a modification for her at a payment she can afford, and ultimately save her home.

And the good news is, more help is on the way. Right now, HUD is working with the Treasury Department on the President's Home Affordable Modification Program. We all know that the program wasn't perfect -- partly because we wanted to get it up and running as quickly as possible.

But we've made changes to make the program more accessible -- working with the banks to process applications, allowing unemployed borrowers to get a minimum of three months of mortgage payment relief and pre-approving borrowers for permanent modifications.

In addition to HAMP, more than a half million families have been assisted through the Federal Housing Administration's loss mitigation options. All told, nearly 3 million borrowers have received restructured mortgages since April of 2009 -- more than twice the number of foreclosures completed in that time.

And very soon, we will be introducing the new "FHA Short Refinance" program -- an expanded refinancing option for non-FHA borrowers who are underwater and owe more on their home than it is worth.

As Marylanders know, you can't move if you can't sell your home -- and this Administration recognizes that in some markets, if you can't move, you can't find a job.

Mark Zandi of Moody's Economy.com has said that helping another million homeowners could be the difference between a double-dip in house prices and continued stabilization -- and believes that our new changes have a very good chance of helping us reach that goal.

Indeed, with efforts like this--that reduce not just interest rates but principal on your mortgage--we believe we can help connect families to jobs and help our economy recover.

And that's really why housing counselors are so essential.

Whether it is helping families stay in their homes or helping them plan their financial future, counselors work to ensure that families have the information they need to make choices that work for them.

Our job in this Administration is to ensure Americans have those choices.

I know this hasn't been an easy time for our communities. But those of us at HUD and across the Obama Administration are committed to helping them recover.

That work begins with working with partners like Majority Leader Hoyer to ensure families get the help they need.

So, thank you for inviting me.

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