Foundation Source launches mortgage assistance programMortgagePress.comFoundation Source, financial assistance, foreclosure, Mortgage Assistance Program, philanthropy
Foundation Source, a provider of support services for private
foundations, has announced an innovative, new program for private
foundations, designed to provide immediate financial assistance to
homeowners under the threat of foreclosure. Through the Foundation
Source Mortgage Assistance Program, private foundations can now
make unsecured, no-interest loans to individuals and families who
are struggling to pay their mortgages due to job loss, reduced
income or other events related to the current economic downturn.
The program taps into the generous spirit of the company's nearly
900 private foundation clients who have expressed a strong desire
to extend the scope of their family philanthropy to include both
traditional charities as well as individuals and families in
need.
The Mortgage Assistance Program, as conceived by Foundation
Source, provides assistance as no-interest loans, known as
program-related investments, not outright grants. As such, funds
will be repaid to the foundation and will then be available for
other charitable purposes. Foundation Source worked closely with
legal counsel at Adler & Colvin (www.adlercolvin.com) to review
and give final shape to the program. Adler & Colvin is a San
Francisco law firm that represents nonprofit organizations and
their donors and has substantial experience in representing private
foundations that offer program related investments. Other details
of the program include:
• Mortgage Assistance Program loans count toward the
foundation's annual five percent minimum distribution requirement
in the year the loan funds are advanced. In future years, the
minimum distribution requirement will be increased by the amount of
the loan(s) repaid.
• Funds are paid directly to the financial institution
holding the mortgage, either in a lump sum, in monthly payments
(full or partial) or in a combination of the two.
• Loans are repaid in monthly installments for up to five
years.
• Due to IRS rules governing self-dealing, foundation
officers, directors, trustees and substantial contributors, and
their respective family members, are not eligible to participate in
the program.
"The Mortgage Assistance Program is yet another innovation from
Foundation Source designed to allow our clients to directly assist
individuals and families in need," said Andrew C. Bangser,
Foundation Source president. "This program joins other pioneering
initiatives from Foundation Source that leverage a private
foundations unique ability to grant philanthropic funds directly to
individuals for hardship, emergency and medical purposes."
Added Jeffrey D. Haskell, executive vice president, Tax and
Legal Affairs, "While making grants directly to individuals in need
can be an extremely rewarding form of philanthropy, it is avoided
by most foundations due to complicated IRS regulations and
requirements. Foundation Source has streamlined this process, so
our clients can focus their foundation activities on assisting
those who so desperately need help."
Rob Wexler and David Levitt, principals with Adler and Colvin,
noted, "Program-related investments are an invaluable tool that
private foundations can employ to help out in tough economic times.
Typically, program-related investment loans are made to
organizations. This program is innovative because it enables
foundations to make loans directly to benefit individuals in
immediate need."
For more information, visit www.foundationsource.com.
