DSNews BY: Brian Honea November 17, 2015
Foreclosures have been continually on the decline nationwide for a few years. While much of the decline can be attributed to a recovering economy, another driver of the drop in foreclosures is increased borrower outreach efforts from various organizations.
Borrower outreach events include HUD-approved housing counselors and mortgage servicers in order to give distressed borrowers a face-to-face meeting to work out a solution such as a permanent loan modification that will allow borrowers to remain in their homes. If a home retention solution cannot be worked out, often a non-foreclosure home forfeiture solution is offered such as a short sale or deed-in-lieu of foreclosure.
Often, borrower outreach events include non-profits the servicers have partnered with or local civic leaders from the cities in which the events are held. On November 14, Ocwen Financial and the NAACP Maryland State Conference hosted a “Help & Hope for Homeowners” event in Upper Marlboro, Maryland; at that event, Ocwen Home Retention Agents and HUD-approved counselors met one-on-one with approximately 325 borrowers to help them avoid foreclosure and make their monthly mortgage payments more manageable.
“It is important to recognize that while some have recovered from the housing crisis, many families, especially in low-income communities, are still struggling to keep their homes. Saturday’s turnout confirms that fact,” explained Edsel Brown, Jr., NAACP Maryland State Conference Economic Development Chair. “The NAACP is pleased that Ocwen is working with us on the local level to offer borrowers the opportunity to meet with their experienced home retention agents and HUD counselors face-to-face to explore modification options that can help save their homes.”
The Maryland event was the fourth in a series hosted by Ocwen and the NAACP this year (the others were in Illinois, Florida, and Maryland). Ocwen and the NAACP have met with approximately 800 homeowners in the four events.
“Both Ocwen and the NAACP are committed to helping borrowers have every opportunity to remain in their homes,” commented Jill Showell, Senior Vice President of Government and Community Relations at Ocwen. “Co-hosting these events with the NAACP, a trusted resource in the community, adds tremendous value and ensures higher participation rates. The numbers speak for themselves.”
“It is important to recognize that while some have recovered from the housing crisis, many families, especially in low-income communities, are still struggling to keep their homes.”
“It is important to recognize that while some have recovered from the housing crisis, many families, especially in low-income communities, are still struggling to keep their homes.”
Edsel Brown
Since 2008, Ocwen has completed more than 520,000 loan modifications. Many of those modifications included a principal reduction for underwater borrowers or borrowers facing foreclosure.
For example, HOPE NOW, a non-profit alliance between counselors, mortgage companies, investors, regulators and other mortgage market participants that facilitates foreclosure prevention solutions, has conducted borrower outreach events in seven cities this year—Oakland, San Bernardino, Chicago, St. Louis, Cleveland, Milwaukee, and La Mirada (in the Los Angeles area), with an event schedule for Fort Lauderdale on November 19 and Queens, New York, in December. In Fort Lauderdale, HOPE NOW is partnering with the Urban League of Broward County; in Queens, they are partnering with the Center for New York City Neighborhoods.
“On the local level, government partners are focused on issues including abandoned properties, affordable housing and neighborhood stability,” HOPE NOW Executive Director Eric Selk said. “Two more roundtables are scheduled for South Florida in November and New York City in December. At face-to-face consumer events so far this year, HOPE NOW servicers are seeing a significant number of delinquent or imminent default customers—65 percent of attendees—as well as a large number of first time loan mod applicants, 38 percent of attendees. Of these homeowners, at least 45 percent are reviewed for HAMP mods and 12 percent are reviewed for proprietary programs.”
A total of 1,636 homeowners have attended the seven HOPE NOW outreach events in 2015. The largest one was in La Mirada, which featured 319 attendees. HOPE NOW has scaled down its events from serving 1,000 attendees to between 300 and 400. An average of about 10 to 12 servicers and 12 to 15 housing counselors attend each event despite a drastic decline in serious delinquencies from their peak five years ago (from four million down to about 1.65 million). Also, the breadth of government and private solutions available has increased; therefore homeowners tend to spend a longer time one on one with their servicer.
According to HOPE NOW, about 20 percent of attendees make same-day decisions about their homes, mostly because servicers need to collect the packages in their entirety before they are submitted to underwriting. Those who do not make same-day decisions, however, often leave with clear and concise next steps along with a single point of contact and a checklist.
