Another $1.9 million available for foreclosure prevention efforts in N.C.

Published 3:03 pm Thursday, December 18, 2008

The holidays may not be as bleak for families facing foreclosure thanks to new federal money coming to the state for housing counseling and the expansion of a state program that provides loans to displaced workers in danger of losing their homes because of job loss.

The North Carolina Housing Finance Agency this month secured $1.9 million of federal funds to support foreclosure prevention efforts by nonprofit counseling agencies statewide. \

Funded by the National Foreclosure Mitigation Counseling Program, the grant is the second that the housing agency has gained this year, for a total of nearly $5 million. So far, the federal funds have enabled counseling agencies to help more than 2,000 North Carolina families.

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The new grant also includes $600,000 for legal assistance. Counseling agencies can refer eligible homeowners for free legal advice to the North Carolina Commissioner of Banks, Pisgah Legal Aid in Asheville, or Legal Aid of Southern Piedmont in Charlotte.

A second resource, funded by the General Assembly, is available to homeowners who have lost&bsp; jobs because of plant closings or other changes in economic conditions.&bsp; Expanded this year to all 100 counties, the Home Protection Program offers zero-interest bridge loans to make mortgage payments while the displaced worker looks for another job or completes an approved retraining program.

The loan amount and length of the assistance vary based upon homeowners&squo; circumstances, with a maximum of $24,000 and 24 months.&bsp; Homeowners resume their mortgage payments when the assistance ends, but do not need to repay the bridge loan for 15 years, unless they sell, refinance, or no longer use the home as their principal residence.&bsp; So far, 364 homeowners have received loans, and 3,000 have received counseling under the Home Protection Program.

&dquo;People facing foreclosure often don&squo;t seek help,&dquo; said Lucius Jones, chairman of the N.C. Housing Finance Agency. &dquo;They have a much better chance of keeping their home if they talk with their mortgage company at the first sign of trouble.

&dquo;These two excellent opportunities to get free, expert advice from a local counseling agency can help struggling homeowners negotiate with their mortgage company and explore other options,&dquo; Jones said. &dquo;Nobody wins when foreclosures take place.&dquo;

For more information, homeowners should contact the participating counseling agencies in their area.

In addition, homeowners facing foreclosure due to a sub-prime loan should contact the N.C. Office of the Commissioner of Banks, which is reviewing sub-prime loans that closed in 2005, 2006, and 2007. Consumers should call 1-888-384-3811.

Approved by Congress in the FY08 Consolidated Appropriations Bill, the National Foreclosure Mitigation Counseling Program is administered through a competitive application process by NeighborWorks ⪚ America, within guidelines defined by Congress.

Additional funding for the program was provided through the Housing and Economic Recovery Act of 2008. NeighborWorks⪚ America is an independent, congressionally chartered nonprofit organization based in Washington, DC, with a mission to provide access to sustainable homeownership and safe, affordable rental housing.

The Home Protection Program was created as a pilot program by the General Assembly in 2004 through collaboration with the N.C. Housing Finance Agency, the N.C. Justice Center, and the N.C. Housing Coalition to help workers who lose their jobs as the result of plant closings and other changing economic conditions.

The North Carolina Housing Finance Agency is a self-supporting public agency. It has financed 184,000 homes and apartments in the last three decades, including more than 77,000 homes for first-time home buyers. To learn more, go to or call 919-877-5700 or 800-393-0988.