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Saturday, January 12, 2008
“Housing counselors hopping in Gwinnett”
The Atlanta Journal-Constitution
The car broke down.
Then the water heater tanked.
Big-ticket items. Right around Christmas, no less.
The homeowners fell behind on the mortgage payments. So they turned to the Consumer Credit Counseling Service of Greater Atlanta. It’s been hopping lately. The agency just announced a hiring blitz to help handle the thousands of clients trying to save their homes.
In Gwinnett, CCCS has two locations. One handles local walk-in clients. The other is a call center of 60 counselors who work with clients with issues like the couple above from Massachusetts.
The housing market has hit tough times. People are losing homes and falling behind on payments. Reasons vary. Some homeowners, though, are victims of material excess. They signed on to legal but risky financial schemes. Then the mortgage rates reset. Their monthly payment ballooned. Trouble.
I sympathize with anyone who loses a home. One group tangled up in the foreclosure crisis gripes me, though. It’s those folk who bought more house than they could afford. And knew it.
What makes a married couple that earns $70,000 a year think they can swing payments on a $275,000 house? With no down payment? The lender, mortgage broker or whoever tells said couple that they “qualify” for that amount should be ashamed.
Last year, the CCCS held 23,000 counseling sessions aimed at accessing finances and helping people avoid foreclosure. Just this December, they handled 3,500, wrote Scott Scredon, the agency spokesman, in an e-mail.
“In 2006, we did 6,579 foreclosure prevention sessions,” he wrote. “The number of counseling sessions has increased significantly … since President Bush’s program to help people with subprime adjustable rate loans was announced Dec. 6.”
CCCS “housing counselors” speak to people from all over the country. Generally, homeowners who contact the nonprofit have missed at least one mortgage payment. Typically, they are 42 years old, with households of three. Gross annual income is about $38,000. Monthly net income is $2,900. The mortgage payment tops $1,500.
And they have thousands of dollars in credit card debt.
On Friday, I listened as Kevin Weekley, a CCCS counselor, talked by telephone to the Massachusetts couple. They have two house loans. One’s for $998; the other $262. They were trucking along just fine till the car and hot water tank conked out.
Weekley collected information about their net monthly income ($2,802) and expenses ($2,119). It’s a good thing, he tells the wife, they have a decent discretionary income. The mortgage holder will be more amenable to working out a payment plan for the past due amount.
In fact, she says they’d already been contacted about such a plan and awaited the details. The past due amount probably will be divided, Weekley tells her, then tacked onto future monthly payments for a certain period of time.
He tellls her to contact him before agreeing to anything, though. The plan has to be an amount the family can withstand.
The wife asks one final question at the end of the 45-minute call.
Could they lose their house for missing one payment?
“They don’t want your house,” Weekley explains.
“They want your money.”
Rick Badie’s column appears on Sundays, Tuesdays and Thursdays. Contact him at 770-263-3875 or e-mail rbadie@ajc.com.
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