Financial Health
Financial Counseling May Save Your Home
By
Jan 30, 2010 - 8:04:35 AM

(HealthNewsDigest.com)-There could be good news for the estimated 5.6 million families on the brink of losing their homes. New research shows that nonprofit groups might make all the difference.

That's why Freddie Mac and 13 of the country's leading nonprofit groups are trying to reach those who are overwhelmed by collector calls or discouraged about getting a mortgage modification.

In addition to a nationwide phone campaign, they've opened walk-in help centers offering "holistic" financial counseling around the country. Holistic counseling addresses a wide range of borrower debt and income issues, not just delinquent mortgages.

This gives people access to one-on-one support from trusted independent, nonprofit organizations, explains Dwight P. Robinson, senior vice president of Community Relations and Housing Outreach for Freddie Mac.

Homeowners who get credit counseling are 60 percent more likely to avoid foreclosure than those who don't get it, says a NeighborWorks America report. That shows credit counseling can work.

Here are four things to look for and four things to avoid when considering a credit counseling agency.

Look for:

• Charges--HUD-approved housing counseling services are free, so if an agency charges a fee, look very carefully at what type of services require a charge;

• A reputable agency that is accredited by a recognized accreditation organization such as NeighborWorks America or the National Foundation for Credit Counseling;

• Organizations that have community presence--branches that are open to the public;

• A written "Action Plan" after each counseling session.

Look to avoid:

• Anyone who "guarantees" success;

• Anyone who charges up-front fees for a mortgage modification;

• Anyone who wants you to sign away your deed, or paperwork you don't understand;

• Any place that wants you to pay it instead of the mortgage company.

You can find a credit counseling agency in the phone book, by calling the U.S. Department of Housing and Urban Development (HUD) at (800) 569-4287 or by looking at the list at www.hud.gov. Homeowners can also call the HOPE hotline for help in English and Spanish at (888) 995-HOPE or visit www.FreddieMac.com/avoidforeclosure.

Editors Note: Freddie Mac Borrower Help Centers Nonprofit Partners Locations and Phone Numbers include: LUCHA, 1152 N. Christiana Avenue, Chicago, IL 60651, (773) 489-8484; Chicago NHS, 1279 N. Milwaukee Ave., 5th Floor, Chicago, IL 60642, (773) 329-4181--Spanish, (773) 329-4185--English; Inland Empire, Neighborhood Partnership Housing Services (NPHS), 320 W. G Street, Suite 103, Ontario, CA 91762, (800) 761-6747; Phoenix NHS, 1405 East McDowell Road, Suite 100, Phoenix, AZ 85006, (602) 258-1659; Chicanos por la Causa, 1112 East Washington, Suite 102, Phoenix, AZ 85034-4043, (602) 253-0838; HomeFree USA, 3401A East West Highway, Hyattsville, MD 20782, (301) 891-4606--English, (301) 891-4607--Spanish.

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