IN THE NEWS

Help available for struggling homeowners

May 6, 2009; As originally appeared in the Huntington Herald

Thousands of Connecticut residents face the prospect that they could lose their homes due to foreclosure.

The reasons vary as to why so many homeowners find themselves in this predicament, unable to meet their monthly mortgage payments. The explanations range from job loss and wage reductions caused by the economic crisis, to being granted subprime home loans many of them could not afford.

However, one factor remains the same for just about every struggling family: They desperately want to retain ownership of their home.

The good news is that help is on the way.

U.S. Rep. Jim Himes (D-4th) hosted an information forum at Bridgeport City Hall Saturday on the various forms of foreclosure assistance available to Connecticut residents.

The forum featured state and local officials, and foreclosure experts from community organizations.

Himes said some 2,400 in the Fourth District families face the threat of foreclosure.

"And 1,000 of them are in Bridgeport alone," Himes said.

An estimated 7,000 homes in the District could be foreclosed in the next four years.

"But we are now assembling tools to deal with this in the future," he said of Congress.

Himes said the Obama administration's new anti-foreclosure plan (Homeowner Affordability and Stability Plan) and the housing bill passed by the House of Representatives last week (Helping Families Save Their Homes Act of 2009) would go a long way toward allowing many Connecticut families to remain in their homes.

In addition, the Greenwich resident said many of the nation's largest banks have put a moratorium on foreclosures, to give the federal government time to work on a comprehensive plan to rescue struggling homeowners.

"We don't want bankruptcy.

We want to prevent foreclosures," he said of the government.

"And the banks don't like it either."

The key component of the Obama administration's plan to prevent foreclosures is a $1,000 financial incentive for loan servicers to modify existing mortgages that are in trouble.

In addition, financial institutions that receive the next round of capital infusions through the Troubled Assets Relief Program will be required to participate in the new foreclosure-related programs, and they must implement stronger loan modification guidelines.

Himes said if the Senate also passes the Homeowner Affordability and Stability Plan, the legislation could save some 1,000 homes in the Fourth District from foreclosure by allowing bankruptcy judges to reduce the secured amount of a home loan down to its fair market value.

Since the housing bubble burst last year, many homeowners are now saddled with mortgages that have a much higher principle than the market value of their homes.

Himes said the modifications - if the current version of the bill does become law - would allow some 7 to 9 million families to restructure or refinance their mortgages, creating more affordable monthly payments and preventing foreclosures.

Himes stressed that there are many programs at the state and local level that can help struggling homeowners stave off foreclosure.

The problem, he said, is that many residents are unaware these programs exist.

"We have to make sure that the people who are struggling are aware of them it's a new world now with new politics," he said of the Obama administration's efforts to stabilize the nation's struggling economy.

CHFA One of the state organizations that provides financial and informational assistance to struggling homeowners is the Connecticut Housing Finance Authority.

CHFA, which also helps low and middle income people purchase their first homes, has been working to prevent foreclosures through the Emergency Mortgage Assistance Program (EMAP).

The program, which was passed by the General Assembly last year, provides financial assistance for up to five years to residents suffering a temporary financial hardship, who have fallen behind on their mortgage payments, and have received a notice of foreclosure from their lender.

"We help people save their homes," said Valencia Taft-Jackson, manager of residential mortgages for CHFA, during Saturday's forum.

Taft-Jackson said the agency had been assisting homeowners through the Connecticut Families Program, a refinancing program, but that program was discontinued on Dec. 31.

She said Connecticut Families II is now being revamped and enhanced, and should provide assistance to residents sometime in the near future.

"So, we are working to fill that gap," Taft-Jackson said.

CHFA has a foreclosure information hotline at (877)-571-2432.

ABCD Action for Bridgeport Community Development Inc., more commonly known as ABCD, provides financial assistance and information to people facing foreclosure.

The regional anti-poverty nonprofit organization serves Easton, Stratford, Monroe, Fairfield and Trumbull, in addition to Bridgeport. It assists some 35,000 people a year, including those facing trouble with their mortgages, according to the organization's executive director, Charles Tisdale.

Tisdale said Saturday that many homeowners have received help through the agency's foreclosure prevention program, in Bridgeport and neighboring communities where homeowners also are struggling.

"They have some of the same needs as the people in Bridgeport," Tisdale said.

ABCD also has a program to assist people facing eviction because they are behind on their rent.

He said that no appointment is necessary to meet with an agency representative. ABCD is at 1070 Park Ave. in Bridgeport.

"This is the tip of the iceberg, and we have a lot of work to do," Tisdale said. "But I'm confident we can do it."

Other organizations Another organization offering assistance is Stamford based Housing Development Funds.

Joan Carty, the nonprofit company's president and chief executive officers, said her organization can provide probono legal assistance to homeowners facing foreclosure.