Housing Action Illinois offers counseling for homeowners facing foreclosure

Homeowners facing foreclosure could help themselves by seeking advice.

That's the conclusion drawn by a group that studied the foreclosure crisis that has cost thousands their homes in Illinois. And getting help is half the battle, according to Housing Action Illinois, a Chicago-based group that provides training and counseling for homeowners.

The study found that many homeowners who are eligible for counseling aren't getting it because they aren't seeking it.

"We found a few communities that seemed to have a high level of foreclosures but below-average levels of counseling," said Geoff Smith, vice president of the Woodstock Institute, which conducted the study with a group of nonprofit organizations and corporations throughout Illinois.

Many people do not know about the Housing and Urban Development programs available, said Katie Gottschall Donohue, director of technical assistance for Housing Action Illinois. In some cases, however, counseling services reported a sharp increase in clients seeking help.

"There just aren't enough resources to help the agencies to meet the current demand," she said.

Local foreclosure rates recently reversed their decline. The number of filings almost doubled between May and June in Madison County and more than tripled in St. Clair County in the past two months. There were 77 new foreclosures filed in Madison County in June after 41 in May. In St. Clair County, 94 foreclosures were filed last month after only 26 the month before.

St. Clair and Madison counties recorded a large surge of foreclosures in the first three months of the year. Madison County foreclosures reached 145 for March, and St. Clair County topped 163 that month. By April, the number of filings dropped to 51 in Madison County and 39 in St. Clair County.

St. Louis nonprofit group Beyond Housing helps people figure out how to address underlying financial problems, get caught up and live up to obligations. Linda Ingram, director of the group's foreclosure intervention department, said it is crucial that people be made aware of the help available, especially since there are so many scams offering help for a fee.

"The big problem now is homeowners that go online and receive information in the mail, and there is so much fraud and scams going on with bogus foreclosure help," Ingram said. "There are homeowners getting caught in that. The one other message to get out is that the help is available at no cost."

Ingram said Beyond Housing's foreclosure counseling program has grown since it was established four years ago by federal government mortgage lender Freddie Mac.

"Having the guidance of a housing counselor cuts out all of that gobbly-gook that people have to go through," she said. "We have had so many clients come in struggling on their own. Our policy at Beyond Housing is that whenever possible, call a lender. It does a couple of things. It gets action going right away. It helps empower homeowners in that conversation and then partners with the homeowner going forward."

She also said that a program launched in March by President Obama -- the Making Home Affordable program -- allows mortgage holders to refinance if they have loans through Freddie Mac or Fannie Mae or remodify their loans, regardless of the lender.

The federal program can help homeowners reduce their interest rate to as low as 2 percent or defer some principle to help get the payment principle, interest, taxes and insurance down to 31 percent of monthly income. In some cases, the homeowners can have their loan repayment extended to 40 years, she said.

"More people are able to solve their problems, and the biggest reason is the Making Home Affordable plan," she said. "The fact is that previous lenders would not help anyone who would miss only one month's payment. They had to get to a certain point, maybe two months or so. And now with the Making Home Affordable plan, if you're in eminent danger of default, they will look at the situation and help families through that crisis.

"That is why it is so important that homeowners seek help right away," she added. "At the very least, call and let your lender know. Some think that if they notify their lender and let them know, they will foreclose faster. That's not true. Banks are not in the business of owning homes. They definitely want to try to work with homeowners."

Another nonprofit community advocacy and home ownership organization that helps homeowners is the Neighborhood Assistance Corp. of America. On July 31 through Aug. 3, the organization will make a stop on its Save the Dream Tour in St. Louis at the Chaifetz Arena, where homeowners can receive consultation from experts. Call (888) 302-6222 or go online at to find out more.

For more information about Beyond Housing, call (314) 533-0600 or visit online at www.beyond