NeighborWorks America, the administrator of the National Foreclosure Mitigation Counseling (NFMC) Program announced that NFMC clients who receive foreclosure counseling are 1.6 times more likely to avoid losing their homes to foreclosure than homeowners who do not receive foreclosure counseling, according to findings in a recently released report. As a result of NFMC Program funding, families who sought and received foreclosure counseling were provided much needed information, assistance and guidance to address their risk of foreclosure, which helped them find a solution to foreclosure.
The report, which analyzed NFMC Program activity during the first year of the program (Jan. 1-Dec. 31, 2008), also found that NFMC Program clients were more likely to receive a loan modification than homeowners who did not receive counseling, and NFMC Program clients who received loan modifications lowered their mortgage payments significantly more than homeowners who received loan modifications without NFMC Program counseling.
NFMC Program clients, with the help of their counselors, secured loan modifications that lowered their monthly mortgage payments $454 more than the clients who received modifications without foreclosure counseling, which results in an average annual savings of $5,448.
“The findings announced today demonstrate the real impact foreclosure counseling can have for families facing foreclosure,” said Ken Wade, CEO of NeighborWorks America. “Thanks to the hard work of non-profit, HUD-approved housing counseling agencies around the country, and the expertise of their certified counselors, families are less likely to lose their homes to foreclosure and receive substantially better mortgage modifications, significantly reducing the likelihood of falling behind again on their mortgage.”
While the report analyzes the program data through December 31, 2008, to date more than 750,000 families have received foreclosure counseling as a result of NFMC Program funding.
The NFMC Program was created by Congress to address the nationwide foreclosure crisis by dramatically increasing the availability of housing counseling for families at risk of foreclosure. The $180 million program was authorized through the FY 2008 Consolidated Appropriations Bill, which named NeighborWorks as its administrator. An additional $180 million was appropriated to this effort on July 30, 2008 through the Housing and Economic Recovery Act of 2008, and the Omnibus Appropriations Act of 2009 appropriated another $50 million to the program on March 11, 2009.
For more information about the National Foreclosure Mitigation Counseling Program, click here.
Click here for NMFC's latest Congressional Report.
