Hope Now Initiative Launched to Aid Homeowners

October 10, 2007 No Comments »

The Bush Administration launched a new mortgage coalition today to help educate homeowners and stem the rise in foreclosures.

The new initiative, referred to as “Hope Now”, brings together mortgage lenders, service companies, counseling agencies, investors, and large trade organizations.

The program aims to help homeowners retain their homes, through a direct mail campaign which will begin in November, as well as developing best practices for counseling groups across the nation to ensure speedy and efficient loan modifications.

The Hope Now website offers a number of resources for homeowners, including tips on locating the lender associated with the mortgage (as they’re often transferred), as well as links to credit counselors who can assist homeowners in need of a loan modification.

Per the website, “HOPE NOW is a cooperative effort between counselors, investors, and lenders to maximize outreach efforts to homeowners in distress.”

Treasury Secretary Henry Paulson noted that 11 of the largest mortgage service companies, representing 60 percent of all mortgages in the country, have already joined the effort, with others more than likely to follow suit.

The companies already involved include Bank of America, Citigroup, Countrywide Financial, Fannie Mae, First Horizon National, Freddie Mac, National City, Washington Mutual, and Wells Fargo.

Countrywide released a press release notifying the public that it was among the lenders who had joined the alliance, just a day after the ACORN consumer advocacy group protested outside many of its branches, claiming the lender did little to help at-risk homeowners save their homes.

“We have 2,700 trained professionals on our homeownership preservation team who work tirelessly to keep our customers in their homes,” said Angelo Mozilo, Chief Executive Officer of CFC.

“We are excited about this new effort to leverage the collective expertise of the public and private sector to help as many families as possible achieve sustainable homeownership.”

Paulson said the initiative is a result of Bush’s request in August to provide better aid to homeowners who were at risk of foreclosure, thanks in part to rising mortgage rates, falling home prices, and resetting teaser rates.

“A unified strategy and better integration will mean homeowners get better help with their mortgages, servicers get better responses when they reach out to people, and our communities will see fewer foreclosures,” Paulson said.

While Paulson seemed pleased by the new program, he expressed that it was a simply a step in the right direction, not necessarily a solution to the growing epidemic.

“We need greater participation if we are going to get all those that need help as quickly as possible,” he said. “Others have good reason to join in this alliance, because minimizing foreclosures benefits lenders and investors as well as homeowners.”

However, industry and government officials warned that though the program would help many homeowners at risk, not all borrowers would be saved from foreclosure, as only those who have a realistic chance of making timely mortgage payments will likely be rescued.

“We are not promising that there’s an answer for everyone, but there is certainly an answer for many,” Paulson said.

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