Foreclosure prevention counseling provides assistance to struggling homeowners with the goal of helping them keep their homes when possible. With the creation of a Foreclosure Prevention Project, homeowners behind on their monthly bills, including their mortgage, have received free confidential financial counseling. Foreclosure legal services help to preserve clients’ credit ratings, save homes from foreclosure and make it difficult and expensive for predatory lenders to continue to engage in abusive loan practices.
Foreclosure prevention counselors review the homeowner’s current income, living expenses, savings, and debts. They also help homeowners to understand their options and possible solutions to their financial challenges. They also assess homeowners’ options for avoiding foreclosure, which could include a loan modification available under the federal Making Home Affordable program or the other borrower assistance program that will become available in the coming months. And, perhaps most importantly, they can negotiate on behalf of homeowners with lenders and attend court appearances.
Legal assistance can be a critical resource to help families stay in their homes and prevent financial losses by negotiating alternatives to foreclosure. Legal assistance also provides representation for families who have been taken advantage of by predatory lenders. Whereas housing counselors might lay out the various options available to prevent foreclosure, offer budget advice and assistance, give information and referral services or help to negotiate a “workout” with the lender, legal assistance tends to be more specific in navigating the legal issues homeowners may face as they try to avoid foreclosure. In many cases, a housing counselor might recommend that a client seek legal assistance to meet their particular needs.
WFP’s Foreclosure program provides legal help to low-income homeowners who are at risk for foreclosure or the loss of equity as a result of predatory lending and can include:
- Representing clients in foreclosure litigation
- Navigating short sales/deeds in lieu
- Fighting deed theft and modification scams through affirmative litigation
- Assisting with reverse mortgages
- Resolving tax and water liens
- Filing lawsuits seeking relief from fair housing and consumer fraud violations