Page 55 – Safeguard Properties

Milwaukee Public-Philanthropic Housing Partnership Recognized Nationally

Posted on June 23, 2023 by Safeguard

Industry Update
June 16, 2023

As the innovative work of community partners to provide a quality, affordable home for every Milwaukeean gains momentum in the city, it is also gaining attention nationally for its early results, cross-sector collaboration and strategic focus on racial equity.

For more than a decade, an affiliation of organizations known as the Community Development Alliance has jointly supported neighborhood-based housing solutions and, since 2020, has led Milwaukee’s first collective affordable housing plan. Adopted in partnership with the City of Milwaukee, Milwaukee County and a host of funders, practitioners and advocates, the plan advances racial equity through systems change, including creating opportunities for 32,000 more Black and Latino residents to become homeowners.

This month, the U.S. Department of Housing and Urban Development and the Council on Foundations awarded the Greater Milwaukee Foundation – a founding partner and a principal funder of the CDA – the2023 HUD Secretary’s Award for Public-Philanthropic Partnerships. In its role, the Foundation helps develop strategy and align resources with partners in government and the nonprofit sector to advance shared goals, together with the other members of the CDA Funders Council – Bader Philanthropies, the Department of City Development, Northwestern Mutual Foundation and Zilber Family Foundation.

“The collective affordable housing plan for Milwaukee’s aim is to advance racial equity by providing a quality, affordable home for every Milwaukeean, prioritizing Black and Latino homeownership.” said Janel Hines, vice president of community impact for the Greater Milwaukee Foundation. “Affordable housing is one of the Foundation’s priorities in our efforts to create a Milwaukee for all. Housing is typically the largest expenditure for any family, specifically for working families. Access to safe, affordable, dignified housing contributes to the health and well-being of families and communities.”

In a few short years, the collective affordable housing plan already is generating strong support and demonstrating progress in priority areas. To date, CDA partners have leveraged over $24 million to advance three key goals: investing in the construction of 150 new homes, acquiring 100 homes per year for homeownership and supporting hundreds of families with down payment assistance.

For full report, please click the source link above.

FHA Proposes Innovative Approach to Keep Struggling Homeowners in their Homes

Posted on June 23, 2023 by Safeguard

Industry Update
May 31, 2023

Source: U.S. Department of Housing and Urban Development

The Federal Housing Administration (FHA) posted for feedback a proposal for a new home retention option to help struggling homeowners meet their mortgage obligations. The new option, called the Payment Supplement Partial Claim, would allow mortgage servicers to use the FHA Partial Claim both to bring a borrower’s mortgage current and to provide temporary reductions to their monthly mortgage payments for up to five years.

The rapid and steep interest rate increases of the past year have limited the effectiveness of some of FHA’s existing loss mitigation options in assisting borrowers. FHA’s widely used loan modification option, which has historically reduced borrowers’ monthly payments to levels they can afford, is no longer as effective as it once was because borrowers are forced to modify at market rates that may be higher than their current rates.

The Payment Supplement Partial Claim allows homeowners experiencing a hardship who are unable to obtain a significant payment reduction with other loss mitigation options to keep their existing interest rate and reduce their monthly payment temporarily using funds from the FHA Partial Claim, which is a subordinate zero interest lien. The homeowners then pay FHA back when they sell their home or refinance.

“Many homeowners continue to experience hardships due to health or financial difficulties that occurred during the pandemic, and these challenges have been exacerbated for these and other borrowers by current economic uncertainties,” said Assistant Secretary for Housing and Federal Housing Commissioner Julia Gordon. “When we saw that our existing loan modifications were no longer providing adequate payment relief, our team painstakingly explored every possible alternative to provide relief in the current rate environment, resulting in this innovative proposal.”

FHA is seeking feedback on this proposal on the Single Family Policy Drafting Table through June 30, 2023.

For full report, please click the source link above.

HUD Awards more than $14.4 Million in Housing Counseling Grants

Posted on June 23, 2023 by Safeguard

Industry Update
June 21, 2023

Source: U.S. Department of Housing and Urban Development

The U.S. Department of Housing and Urban Development’s (HUD) Office of Housing Counseling (OHC) is announcing today that it has awarded more than $14.4 million in housing counseling grant funding to 180 housing counseling organizations. The awards will support the comprehensive housing counseling services provided by grantees to homebuyers, homeowners, and renters, and will help to continue the important work that began in 2021 to reach deeper into underserved communities through partnerships between HUD-approved housing counseling agencies, Historically Black Colleges and Universities (HBCUs), and other Minority Serving Institutions (MSIs).

“Homeownership is the primary way most people in this country build wealth. It has the power to transform not only your life, but the lives of your family members,” said HUD Secretary Marcia L. Fudge. “Housing counseling services help ensure current and prospective homeowners have all the tools they need to purchase and maintain the homes of their dreams.”

“Partnering with a housing counselor empowers individuals and families with the education and resources they need to make informed decisions regarding their housing needs,” said Assistant Secretary for Housing and Federal Housing Commissioner Julia Gordon. “These awards help to ensure that households across the country have access to high quality housing counseling services, particularly those for whom systemic barriers and racial inequities have made it difficult to obtain safe and affordable housing.”

“We are pleased to fund these HUD-approved housing counseling agencies that offer vital resources to consumers, including pre-purchase homebuying information, foreclosure and rental eviction prevention, mortgage options for seniors seeking to age-in-place, and disaster recovery counseling,” said Deputy Assistant Secretary for Housing Counseling David Berenbaum.

For full report, please click the source link above.

The CFPB Intends to Identify Ways to Simplify and Streamline the Existing Mortgage Servicing Rules

Posted on June 21, 2023 by Safeguard

Industry Update
June 15, 2023

Source: Consumer Financial Protection Bureau

Borrowing to buy a home is one of the biggest financial decisions a family will make. Mortgage servicers are the companies responsible for processing payments and managing mortgage accounts, and they play a critical role in assisting homeowners with repayment. Borrowers don’t choose these companies – servicers are chosen by the lender or investor that owns the mortgage.

In the mid-2000s, predatory mortgage practices spread throughout the country. Many large financial institutions with mortgage servicing operations experienced serious breakdowns. This resulted in a crisis where 10 million homes ended up in foreclosure between 2006 and 2014.

The foreclosure crisis was an important catalyst for the creation of the Consumer Financial Protection Bureau. Congress required the CFPB to implement new rules to make the mortgage market work better. These new rules first took effect in 2014. During the COVID-19 pandemic, we saw how these rules worked when unemployment spiked. The CFPB observed that there were places where the rules could be revised to reduce unnecessary complexity.

Last fall, the CFPB asked the public for input on ways to reduce risks for borrowers who experience disruptions in their ability to make mortgage payments, including input on the mortgage forbearance options available to borrowers. In particular, we sought input on the features of pandemic-related forbearance programs and whether there are ways to automate and streamline long-term loss mitigation assistance. We received comments from housing organizations, homeowner advocates, mortgage servicers, and many others.

Many commenters noted that borrowers seeking help on their mortgages can face a paperwork treadmill that hurts both homeowners and mortgage servicers. According to commenters, the temporary pandemic-related changes we made to the mortgage servicing rules helped alleviate this problem and get borrowers accommodations more quickly.

Commenters also expressed concern that borrowers often incur servicing fees and experience negative credit reporting while waiting for their mortgage servicers to review their options. These penalties can hurt borrowers even after loss mitigation options have been implemented, and they can sometimes even prevent loan modifications and other interventions that allow borrowers to keep their homes.

When homeowners who struggle to make payments get the help they need without unnecessary delay or hurdles, it is better for borrowers, servicers, and the economy as a whole. The CFPB will be using this input from commenters to propose ways to simplify and streamline mortgage servicing rules. We will propose streamlining only if it would promote greater agility on the part of mortgage servicers in responding to future economic shocks while also continuing to ensure they meet their obligations for assisting borrowers promptly and fairly.

We also continue to welcome petitions on potential amendments to the CFPB’s rules.

For full report, please click the source link above.

Share of Mortgage Loans in Forbearance Decreases to .49% in May

Posted on June 21, 2023 by Safeguard

Industry Update
June 20, 2023

Source: Mortgage Bankers Association

The Mortgage Bankers Association’s (MBA) monthly Loan Monitoring Survey revealed that the total number of loans now in forbearance decreased by 2 basis points from 0.51% of servicers’ portfolio volume in the prior month to 0.49% as of May 31, 2023. According to MBA’s estimate, 245,000 homeowners are in forbearance plans. Mortgage servicers have provided forbearance to approximately 7.9 million borrowers since March 2020.

In May 2023, the share of Fannie Mae and Freddie Mac loans in forbearance decreased 1 basis point to 0.23%. Ginnie Mae loans in forbearance decreased 5 basis points to 1.06%, and the forbearance share for portfolio loans and private-label securities (PLS) decreased 3 basis points to 0.58%.

“The number of loans in forbearance is reaching levels not seen since the beginning of March 2020, prior to the passage of the CARES Act,” said Marina Walsh, CMB, MBA’s Vice President of Industry Analysis. “Today, more than 96 percent of homeowners are current on their mortgages, thanks to the favorable jobs market and the success of loss mitigation options over the past three years.”

For full report, please click the source link above.

House Members Introduce ‘Neighborhood Homes Investment Act’ to Expand Affordable Homeownership Opportunities

Posted on June 16, 2023 by Safeguard

Industry Update
June 9, 2023

Source: prnewswire.com

Representatives Mike Kelly (R-PA) and Brian Higgins (D-NY) introduced legislation to create a new tax incentive that would produce 500,000 starter homes in under-resourced communities over the next decade. The Neighborhood Homes Investment Act (“Neighborhood Homes”) would address the needs of families throughout the country who are struggling to purchase homes as costs continue to rise and the supply of homes remains limited.

In many areas, the cost to build or rehab a home exceeds the price at which the home could be sold once completed. The new tax credit would help fill that “value gap” – up to 35 percent of eligible development costs for new homes – thus reducing the developer’s risk of loss and encouraging investments in new and rehabbed housing. This will in turn make homeownership more feasible and support broader revitalization and economic development strategies in disinvested urban and rural communities. Joining Representatives Kelly and Higgins as original co-sponsors of the legislation were Representatives Claudia Tenney (R-NY), Dan Kildee (D-MI), Randy Feenstra (R-IA) and Dwight Evans (D-PA). Similar legislation introduced in the previous session of Congress was co-sponsored by 133 Members of the House and Senate from 37 different states, from Delaware to North Dakota to California.

For full report, please click the source link above.

Akron Selects 40 Vacant Properties for 2023 Mow to Own Program

Posted on June 16, 2023June 16, 2023 by Safeguard

Industry Update
June 15, 2023

Source: cleveland19.com

Akron City Council approved a second round of Mow to Own lots in the city last week.

The city has been able to give away over 100 vacant city-owned lots to nearby property owners so they can maintain them.

City officials say the list for this year contains 44 vacant lots.

A press release from the city says that neighboring property owners and non-profits may be eligible to purchase city-owned property for the cost of mowing from the time a contract is signed through closing, including standard closing fees.

Officials say letters will be sent first to owner-occupied property owners adjacent to the lot, and will move on to property owners near the lot who do not live in that property and non-profits if original offers are turned down.

For full report, please click the source link above.

FHA Launches New Resources to Remove Language Barriers for Borrowers

Posted on June 15, 2023June 15, 2023 by Safeguard

Industry Update
June 13, 2023

Source: U.S. Department of Housing and Urban Development

The Federal Housing Administration (FHA) is making available in Chinese, Korean, Spanish, Tagalog, and Vietnamese more than 30 single family mortgage documents and related resources used in the origination of FHA-insured mortgages. The educational resources are accessible from FHA’s new language access web page and are intended to assist lenders, servicers, housing counselors, and other FHA program participants in explaining information related to FHA-insured mortgages to those with limited English proficiency prior to borrowers executing legal documents in English, as required by law. This first set of translations is part of ongoing efforts by FHA to remove language access barriers for consumers whose preferred language may not be English, and a part of HUD Secretary Marcia L. Fudge’s commitment to making equity a leading compass within the Biden-Harris Administration.

“Understanding the products, processes, and documents associated with a mortgage transaction is vital to a borrower’s ability to become a successful homeowner,” said Assistant Secretary for Housing and Federal Housing Commissioner Julia Gordon. “These new resources will help prospective homebuyers better understand their transaction and make more informed decisions before they are at the closing table.”

The translated documents include the HUD Addendum to the Uniform Residential Loan Application (HUD 92900-A) required for all FHA-insured single family mortgages; model documents, including mortgage notes and riders used in FHA forward and Home Equity Conversion Mortgage (HECM) transactions; and required borrower disclosures. In addition, FHA now has newly translated versions of some of its most widely used single family homebuyer education materials and information resources, including its Save Your Home, Tips to Avoid Foreclosure brochure, its disaster relief and recovery options information card, and FHA “myth busters” question and answer cards.

FHA intends to make additional resources available in the future.

For full report, please click the source link above.

Freddie Mac Adds Affordable Housing Program for Native Americans

Posted on June 15, 2023June 15, 2023 by Safeguard

Industry Update
June 8, 2023

Source: National Mortgage Professional

Freddie Mac last Wednesday launched a new mortgage product to support members of Native American communities.

Called HeritageOne, it will provide affordable financing options for single-family properties on tribal lands in rural areas, creating greater access to homeownership, the government-sponsored enterprise said. The program will also provide financial counseling and other resources to members of Native American tribes, especially first-time homebuyers.

“With HeritageOne, we are again breaking new ground in our efforts to safely and responsibly expand opportunities in traditionally underserved communities,” said Sonu Mittal, Single-Family senior vice president of acquisitions at Freddie Mac. “Our commitment to make home possible for Native American families not only requires long-term planning and prudent execution, but strong partnerships with industry members and tribal leaders. Through this collaboration, we can help create more affordable mortgage options in tribal lands and rural areas.”

The intent behind HeritageOne is outlined in Freddie Mac’s 2022-24 Duty to Serve Plan, which specifically details the company’s commitment to provide housing support for tribal members in rural tracts within Native America communities, Freddie Mac said.

“The limited access to affordable mortgage financing options has affected our communities for far too long and it has impacted the ability of our members to build generational wealth through homeownership,” said Tawney Brunsch, executive director of Lakota Funds, the first-ever Native community development financial institution on tribal lands. “HeritageOne can help break down these walls, providing greater access to responsible homeownership and broader economic opportunities through financial counseling for our historically underserved communities. We look forward to making HeritageOne widespread in tribal lands.”

For full report, please click the source link above.

U.S. Foreclosure Activity Sees Spike in May 2023

Posted on June 15, 2023 by Safeguard

Industry Update
June 8, 2023

Source: ATTOM

ATTOM, a leading curator of land, property, and real estate data, today released its May 2023 U.S. Foreclosure Market Report, which shows there were a total of 35,196 U.S. properties with foreclosure filings — default notices, scheduled auctions or bank repossessions — up 7 percent from a month ago and up 14 percent from a year ago.

“The recent increase in foreclosure filings nationwide indicates a trend that has been observed throughout the year, and what we have expected to occur,” said Rob Barber, CEO at ATTOM. “This upward trajectory suggests the possibility of continued heightened activity, and with foreclosure completions seeing the largest monthly increase this year, we will continue to monitor the potential impacts this may have on the housing market.”

For full report, please click the source link above.