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Foreclosure prevention loans assists thousands, saves billions 

Home foreclosures can cause strain on families, neighborhood stability and city budgets. The North Carolina Housing Finance Agency estimates each foreclosure can cost up to $34,000 in missed tax payments, unpaid water and sewage bills, loss of property values and many other city services. 

However, help is available.

The successful North Carolina Foreclosure Prevention Fund has saved $2.1 billion in homes and 15,500 families from foreclosure with resources to help 5,500 more.

The Fund makes mortgage payments for unemployed homeowners while they look for work or retrain. Once homeowners find a job they resume making their mortgage payments. Since late 2010, 8,850 families have reached that stage, and 98 percent have avoided foreclosure. The assistance is also available to returning veterans and people who have experienced temporary setbacks, such as a divorce or serious illness, that require them to look for a new job.

 The North Carolina Housing Finance Agency has resources available to assist unemployed homeowners with foreclosure prevention. Photo credit: North Carolina Housing Finance Agency
The program is offered by the North Carolina Housing Finance Agency, a self-supporting state agency, with funds from the U.S. Department of the Treasury. North Carolina received the resource in 2010 because of widespread unemployment during the economic downturn.

“This has been a huge effort that is benefitting the whole state,” said A. Robert Kucab, executive director of the North Carolina Housing Finance Agency. “Foreclosures hurt everyone.  By preventing foreclosures for people who have already suffered job loss, we preserve family stability, neighborhoods and the tax base.” 

The Fund has helped homeowners in municipalities in all 100 counties.  

“We know how devastating foreclosures can be to our citizens and to the town,” said Garner Mayor Ronnie Williams, where the Fund has helped 100 homeowners and saved $15.8 million in property value. “We’re committed to providing resources for our citizens to secure employment and hold on to their homes.”

The Town of Garner partnered with the Agency in February to sponsor a Job Search Boot Camp, which highlighted the Fund.

To qualify, homeowners must have lost their jobs through no fault of their own, be returning veterans, or be seeking new employment after divorce or other hardships. They do not need to be behind on their payments to apply.

Assistance is offered as a a zero-interest, deferred loan of up to $36,000 paying mortgage and related costs for up to 36 months while the unemployed homeowner seeks or retrains for a job. Homeowners remaining in their homes for 10 years do not need to pay back the loan.

The Fund can also reduce a homeowner’s total monthly payment to an affordable level by providing a zero-interest mortgage up to $30,000, to pay off a second mortgage. Homeowners who find a new job, but at reduced income, can benefit. The loan is repaid when the owner sells or refinances the home to take out cash or consolidate debt.

There is no cost to homeowners for assistance. Eligible homeowners can apply through 41 HUD-approved counseling agencies or online. For more information, homeowners should call 1-888-623-8631, or go to http://www.NCForeclosurePrevention.gov.

The best way to help your citizens—and your bottom line—is by getting the word out by posting the link above on social media, distributing fliers, hosting an informational event or adding an announcement in city publications and bills.

For materials information or help with hosting an event, contact Robert Sherwood at 919-981-2647. Get the latest news by following the N.C. Foreclosure Prevention Fund on Facebook and @ncfpf on Twitter.