Several weeks ago I came across a report. This report gave an overview of what is considered to be the most successful program at the present time to help people facing foreclosure save their homes. It was started in Philadelphia last May.
The program focuses on modifying people’s mortgages and reducing their monthly mortgage payment to a level they can afford to pay. At the end of 2008 over 78% of the people who had their mortgages modified through the program remained in their homes. That may not seem that impressive. However nationwide, less than 50% of the people who had their mortgages modified through other programs were consistently making their mortgage payments on time after 6 months and were facing foreclosure again.
This program doesn’t have a catchy name. In fact, it’s embarrassing because it’s so technical – the Residential Mortgage Foreclosure Diversion Pilot Program. It is run and overseen by the courts in Philadelphia.
The first thing that intrigued me about this program is the community outreach component. The program is mandatory for anyone facing foreclosure. As soon as their mortgage company sends them a letter starting the foreclosure process, they are supposed to call and schedule a meeting with a housing counselor.
The court system realized that they could not rely on the people facing foreclosure who were sent this letter to call and schedule the meeting with the housing counselor. The court also realized that most would probably never open the letter. So they had to try something else.
They got community organizations to reach out to them. When a letter is sent out to a person notifying them that foreclosure is starting, their name and address are routed to a community organization. The community organization has one of their representatives contact the person.
The representative does not do this by phone. They go out and meet with the person. They tell them about the process set up in Philadelphia. They also tell them that the first step is for them to meet with a housing counselor. They then have the person call the housing agency. Most times these calls were made while the representative from the community organization is with the person. Frequently the representative gives the person their cell phone to make the call.
Let’s look at this more closely. Most people who are facing foreclosure are embarrassed at what is happening to them. They frequently beat themselves up for allowing themselves to get in this situation. They don’t want others to know about it. So they keep it to themselves.
Many don’t take any action at all. They won’t open mail they get. They won’t answer the phone. They hope that it will just go away. Unfortunately by doing this they frequently jeopardize any chance they have to save their homes.
So the representative from the community organization in Philadelphia who contacts them is actually giving them much needed support. That person is letting them know that people care about them. People are available to help them through this crisis in their life. The representative gives them the courage to reach out and take the step to get the help they need.
As I read this, I started thinking. I wondered why the same thing couldn’t be done across the country. What if people from community organizations and churches were enlisted to go out and talk to people who were just notified that the foreclosure process had started? What if these people were able to support them and to let them know of the help available to them right there in their own community to protect their family and save their home? Wouldn’t we go a long way in solving this foreclosure crisis very quickly?
As I thought more about this, I realized that the best people to call on the people being notified that foreclosure was starting were those who had faced foreclosure and who had been able to save their homes. They could relate better to what they were going through than any other person.
Isn’t it time we explored getting such a program going?
Much Success,
Mark Elkins
