NFMC Clients’ Payments Decreased By An Average Of $176 More Per Month Compared To Non-NFMC Clients
To alter an old phrase, “Don’t cut the budget of the non-profit housing agency that helps you.” In the recovery from the real estate meltdown, neighborhood counseling non-profits have done yeoman work to assist homeowners secure loan modifications.
According to a recent Neighbor Works America report, the National Foreclosure Mitigation Counseling (NFMC) program has assisted about 1.5 million at-risk homeowners. The nonprofits included in that program represent many of the ones that loom on the budget chopping block.
According to the report, homeowners who received mortgage modifications from NFMC saw their monthly payments decrease by an average of $176 more per month compared to non-NFMC clients.
Up To 90 Percent Of Homeowners Re-Default After Loan Mod
We normally profess about how homeowners should seek the assistance of a non-profit counselor rather than deal with the banks directly for loan modification requests. The report numbers show this advice to be solid as homeowners who received assistance from NFMC were nearly twice as likely to receive a modification. Additionally, they were at least 67 percent more likely to stay current 9 months after getting modified. Unfortunately, per our recent blog post up to 90 percent of homeowners who receive loan medications end up re-defaulting.
The report findings show that the main struggle for NFMC clients facing foreclosure continues to be income loss or income reduction. A whopping 37 percent of program clients spend at least half of their income on their monthly mortgage payment, and about 19 percent spend more than 75 percent of their income on their mortgage.