Written by J. Patrick Eaken
Saturday, 25 October 2008 19:19
Because of today’s poor housing market, local community organizations are now spending their resources helping individuals facing foreclosure instead of renovating homes.
As a result, Housing East Revitalization Corporation is consolidating its operations with Neighborhood Housing Services (NHS) of Toledo, Inc.
Both NHS, with offices on Second Street in East Toledo, and Housing East, under the auspices of its long-time director, Paul “Pat” Hecklinger, were in the business of renovating homes in older neighborhoods. Both are having a difficult time finding buyers for their product in today’s market.
“Pat puts out a tremendous product,” says NHS director William E. Farnsell. “His finished product is beautiful, it is attractive, it is affordable, and it is just a very nice deal with whoever buys that property.
“We have no shortage of lookers. The problem is most of the people coming in have terrible credit and can’t borrow the money. Pat may be able to borrow the money and rebuild it, but consumers no longer have the ability to get the refinancing because their credit is crappy,” Farnsell continued.
“The resources are there. You can borrow the money with subsidies from the City of Toledo. You can do all that, but we’ve got no buyers.”
Therefore, NHS, which has been in business since 1977, is putting all its housing resources into rescuing mortgages.
“That is just about all we’ve been doing since the first of the year. It’s been the first of the year since we’ve had a lot of resources in our pockets to help a lot of people,” Farnsell said.
“In terms of what share of our business it is, we’re pretty big into lending, but helping people with foreclosure prevention, rescue funding, and all that, has basically taken over our loan line in terms of what we are doing for business.”
Since the beginning of the year, Farnsell estimates NHS has rescued 90 consumers in mortgage trouble with either a loan, grant, or a loan and grant combination.
There are certain parameters for a family to be qualified.
“We can only swing into action when the mortgage has been declared in default, or if it’s a creditor doing an inquest. Even to have real estate values drop, as long as the consumer is making the payment, it’s really not an issue yet,” Farnsell said.
“Basically, we’re looking at creating a household budget based on the information they’ve given us, and making some sort of determination of whether a rescue needs to be made, financially. Will they be able to keep up the payments after that?”
NHS has four programs available — two are loan payments for any family in Ohio whose household income is 115 percent of median or less.
“If there is somebody in Wood County or Ottawa County, they can come here and get those. We have provided loan resources in Oak Harbor, and we’ve had requests from Tiffin and Bowling Green. We’ve done consumers all over Northwest Ohio,” Farnsell said.
But the other two programs are for Lucas County residents only.
“Everything that’s available we’ve got,” Farnsell said. “It starts with two things. First, we have both counseling assistance because we’re a HUD-housing counseling agency, and we have mortgage-prevention rescue loans and grants.
“Everybody that comes in here has to go through some sort of counseling. It’s primarily financial management because we’ve got people who are in trouble. They’ve lost a job or they’ve been sick and they haven’t had the ability to pay for some period of time on their mortgage.”
Farnsell said counseling is to conclude what a family’s income is, what expenses are, figure out a budget, and determine primarily how much the family needs to catch up on their mortgage payments.
“Once you get past that, then we look behind that and see if, ‘Do we have the ability to rescue them? Do they have the ability to sustain and make payments?’” Farnsell said.
“The mortgage-rescue funding that we have is really a very narrow thing. It’s for people who have missed a payment, or two, or three in their mortgage because they’ve had an interruption. They were laid off and now they are back on the job, or they’re off work and didn’t have any income coming in and now they are back to work. Our rescue programs are really designed to catch people up so that they are not chronically late.”
To request help, Farnsell recommends calling his office at 419-691-2900, and NHS will send an application. The forms ask questions about the family’s budget and request a fee to give NHS permission to pull a credit history.
“We’ll take a look at it, then we’ll start to talk to you and your mortgage company, and we’ll start working on making a deal. We’ll then put on the table one or more of these different resources in order to make a deal with your servicer,” Farnsell said.