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The Home Ownership Preservation Initiative in Chicago (HOPI): Reducing Foreclosures through Strategic Partnerships.


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The Home Ownership Preservation Initiative in Chicago (HOPI): Reducing Foreclosures through Strategic Partnerships. Bruce Gottschall, Executive Director Neighborhood Housing Services of Chicago. Neighborhood Housing Services of Chicago.
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The Home Ownership Preservation Initiative in Chicago (HOPI): Reducing Foreclosures through Strategic Partnerships Bruce Gottschall, Executive Director Neighborhood Housing Services of Chicago

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Neighborhood Housing Services of Chicago Who is NHS – The mission of NHS is to help neighborhoods stay solid – by peopling purchase, alter or stay in their homes. We are a not revenue driven group association that has been working in Chicago neighborhoods for a long time. We have 8 nearby workplaces that serve 9 focused on neighborhoods: Auburn Gresham/Englewood West Englewood – 60620 & 60636 Back of the Yards/Garfield Boulevard – 60609 & 60621 Chicago Lawn/Gage Park - 60629, 60632 & 60652 North Lawndale – 60623 & 60612 West Humboldt – 60624 & 60651 Roseland – 60628 South Chicago – 60617 Central Office – Provides City-Wide projects We Serve 1-4 unit mortgage holder inhabitants

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Foreclosures Threatened Chicago's Neighborhoods

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Fast Foreclosures in NHS Targeted Areas Half of Loans Start Foreclosures inside 3 years of Origination Dramatic increment Since 1993 52% of all credits beginning abandonment in 2001 were begun after 1998 72% of advances which were valued 300 premise focuses more than 30 year Treasury and beginning dispossession in 2001, were started after 1998

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NHS Case Study of Foreclosure Impact:

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Chicago's Home Ownership Preservation Initiative (HOPI) Model Partnership Between: NHS City of Chicago, Department of Housing Federal Reserve Bank of Chicago Major Lenders/Servicers

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Chicago's HOPI Approach Quality property holder training to avert present and future misconducts. Direct Interventions to help property holders at danger of abandonment. Recover abandoned homes for proprietor tenants Study home loan and adjusting sways on neighborhoods to grow best practices as a "research facility" for preparing and replication

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Chicago's Home Ownership Preservation Initiative (HOPI)

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HOPI Approach Borrower Access/Entry to Counseling and Support System Appropriate and Escalating Forms of Counseling and Support Comprehensive Loss Mitigation Effort and Resources REO Disposition Community Partnership and Neighborhood Engagement "Lab Role"

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Survey Findings of NHS Counseled Families Demographics of HOPI Clients 73% Women 81% African American 15% Hispanic Length of time lived in Home Mean 10 years Median 7 years Income Mean $27,000 (38% of AMI) 1/3 underneath $18,000 (25% of AMI) Average misconduct was 5.4 months when reached by NHS Source: NHS Chicago – Survey, 2005 (800 customers)

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Profile of Respondents 69% First-time Buyers 55% First-time Refinancers 52% First-time Defaulters Median Purchase Time: 5 years prior Median Mortgage Balance: $87,500 62% have petitioned for Bankruptcy sooner or later Average Delinquency: 4.6 Months (up to 3 years) Source: NHS Chicago-Defaulted Borrowers Survey, 2005 (289 respondants)

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72% of Defaulted Loans are Refinances Source: NHS of Chicago-Defaulted Borrowers Survey, 2005 (183/289 respondents)

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Why, if Behind, Did not Contact Lender? Source: NHS Chicago-311 Survey, 2005 (56/289 respondents)

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NHS of Chicago Resources: Intensive Foreclosure Counseling Foreclosure Intervention Program Below-business sector rate advances to restore a home loan Homeownership Preservation Initiative Refinance And Refinance/Rehab Loans

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Public-Private Partnerships Maximize Impacts State Housing Agency Referral systems Payment help Emergency advances Training for instructors Financial backing for nonprofits Credit Counselors Phone guiding Manage hotlines Budgeting Debt administration plans Lenders/Servicers Forbearance Loan adjustment Counseling referrals Support for collaborations Nonprofit Housing Counselors In-individual directing Borrower training Housing issues Facilitate workouts Administer awards/advance City/State Government Hotlines Public mindfulness Facilitating collaboration

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Connecting Distressed Borrowers to Services Distressed Borrower 3 1 Contact Lender/Servicer 2 Contact Community-based Organization (3 rd gathering will expand trust, data or change conduct) Call Hotline to Credit Counseling Refer to Community-based Organization Improve Budgeting Connect with Lender/Servicer (half of reprobate borrowers not in contact) REO Disposition Home exchanged to home loan prepared borrower Increase Timely Payments (20-30% of borrowers just need spending administration) Property Services Home safeguarded for resale or proceeded with possession Emergency Loan or Grant Forbearance or Workout Preserves: Borrower House Neighborhood

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HOPI – Three Year Goals Homeownership Preservation Help 1,500 families eager abandonment Property Preservation Reclaim 300 dispossessed properties as group resources Community Development Cultivate people group improvement best practices

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HOPI Results: April 2003 – March 2005 2,770 mortgage holders finished advising 530 through workshops in group 800 through 311; 56% paid for by taking part lenders Estimated 37% of 311 guests cured issue or sold home inside a year of accepting administrations 940 Foreclosures kept 175 Buildings recovered from dispossession Source: The Chicago Hone Ownership Preservation Initiative: A Learning Laboratory, Neighborhood Housing Services of Chicago, Inc. June 2006

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City of Chicago Foreclosures 1999-2004

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Emerging Trends Mortgage Rescue Distressed property specialists and Distressed property buyers "Flip and Default" "No Doc" "Expense for Service" "Purchase Lease Back"