National nonprofit assists thousands of homeowners unable to make mortgage payments and uncertain about forbearance protections.
FARMINGTON HILLS, Mich. (February 18, 2021) – GreenPath Financial Wellness, a national nonprofit that provides financial counseling and debt management services and its affiliate, Homeownership Preservation Foundation (HPF) that provides housing counseling services, helped 19,500 borrowers experiencing COVID-19 and other related financial hardship avoid foreclosure in 2020. Hundreds of callers each day seek help through the nonprofit’s HOPE Hotline (888 995-HOPE). In addition to foreclosure prevention, HPF’s certified counselors assist callers with forbearance guidance, pre- and post-modification support, reverse mortgage and rental counseling.
Nearly 3 million homeowners were behind on mortgage payments by the end of December 2020, a 79% year-over-year increase. The Mortgage Bankers Association estimates there are 2.6 million U.S. households in forbearance plans. Approximately 600,000 of those plans may expire at the end of March.
The Biden administration announced that borrowers with Federal Housing Administration (FHA), Department of Veterans Affairs (VA) and U.S. Department of Agriculture (USDA) loans: 1) may request up to (2) three-month extensions when their forbearance plans expire, 2) have until June 30th to make an initial forbearance request and 3) placed a moratorium on foreclosures through June 30th. Borrowers with Fannie Mae and Freddie Mac loans: 1) may request a three-month extension when their forbearance plans expire, 2) have until February 28th to request an initial forbearance and 3) placed a moratorium on foreclosures through March 31st. Deadlines are constantly being amended. Borrowers with private or portfolio loans may have a greater likelihood to become delinquent and should contact their loan servicer for forbearance and foreclosure accommodations.
“HPF has a long-standing track record of providing trusted housing counseling. We’ve helped nine million distressed borrowers since the 2008 housing crisis,” said Rod McGinniss, Senior Vice President, Business Development, HPF. “Our 995HOPE hotline and website provide much-needed resources to help people not confident they can resume payments once forbearance ends to understand their options, avoid foreclosure and remain in their homes.”
Low-to-moderate income homeowners and Black and Hispanic households are disproportionately likely to face greater hardship. Between August and November 2020, nearly 12,000 homeowners HPF counseled had an income level below 80% of the area median income. Most of the 8,700 homeowners of color HPF counseled were experiencing higher rates of mortgage distress. An Urban Institute study found that 19% of Black households and 15% of Hispanic households were not caught up on mortgage payments (compared to 9.8% of total households surveyed).
HPF certified counselors, specifically trained in housing programs, look at borrowers’ entire financial picture, document steps to catch up and maintain their housing payments, help them understand their mortgage terms and interest rates, and avoid scams. Borrowers who participated in HPF’s post-modification counseling received empathic, personalized services and were 20 percent less likely to redefault.
McGinniss added: “We encourage borrowers not to rely on moratorium extensions. The sooner they prepare to resume mortgage payments, the better. Now is a good time for any borrower concerned or stressed about making their mortgage payments to reach out for support and make a plan.”
About Homeownership Preservation Foundation
Homeownership Preservation Foundation, also known as HPF, is a national nonprofit organization dedicated to guiding consumers on the path of sustainable homeownership and improving their overall financial health. Since its founding in 2004, HPF’s certified counselors have provided trusted, independent housing information and assistance to millions of callers. The HOPE™ Hotline (888-995-4673) and 995HOPE website (https://995hope.org) provide accessible resources to help people manage the homeownership lifecycle and increase financial wellness.
About GreenPath Financial Wellness
GreenPath Financial Wellness is a national nonprofit that has empowered people to manage their debt, buy and remain in their homes, and lead financially healthy lives for 60 years. As one of the largest financial counseling agencies in the nation, GreenPath has assisted millions of people with education and products in debt and credit management, student loans, homeownership and foreclosure prevention. Headquartered in Michigan, GreenPath and its affiliates work directly with individuals, banks, credit unions and employer partners from more than 50 locations across the U.S. and through phone access and online tools. GreenPath is a member of the National Foundation for Credit Counseling, Michigan Diversity Council, Texas Diversity Council, and is accredited by the Council on Accreditation. To learn more, visit www.greenpath.org or call 866-648-8122. Follow the nonprofit on Facebook and Instagram @greenpathfinancial and on Twitter @GreenPath.