Housing counseling—both for reverse mortgage borrowers as well as households with traditional forward mortgages—has been very busy in recent years. In the reverse business, agencies are seeing a rising number of counseling sessions this year, as well as a short-term uptick due to product changes implemented in early August.
And according to a recent study for NeighborWorks America by the Urban Institute, it’s working: homeowners have saved tens of millions of dollars under the National Foreclosure Mitigation Counseling program, the organizations found.
Those who work with the NFMC program counselors are three times more likely to obtain a mortgage modification that saves them money, according to the findings. They’re also 60% less likely to re-default after curing a serious delinquency.
“If there was any lingering doubt about the value of NFMC counseling for homeowners and the broader real estate industry, the research announced [this week] should put those doubts to rest,” said NeighborWorks America acting CEO Chuck Wehrwein. “Whether measured by benefits to homeowners through more likely mortgage modifications, sustainability of those modification or mortgage cures, the research answers all housing counseling benefit questions with a resounding ‘yes.’”
The benefits are not only realized by homeowners, but also by mortgage servicers and the real estate community, NeighborWorks notes.
Written by Elizabeth Ecker