More than 5 million U.S. homeowners -- 170,000 of them in Georgia -- have modified mortgage loans since the housing crisis forced the finance industry to rethink the way it went after foreclosures, according to the HOPE Now Alliance.
"Four years ago there were close to zero loan modifications. It was a barely measurable data point," said John Dalton, president of the Housing Policy Council of the banking industry's Financial Services Roundtable. "Quite simply, the homeowner either paid his or her mortgage or the house went into foreclosure.
"Obviously, when the housing crisis hit this was no longer sustainable in a fragile economy," he said.
Four years ago the finance industry and nonprofit organizations such as Atlanta's CredAbility, which has given foreclosure counseling to more than 50,000 Georgians, began the HOPE Now Alliance campaign. The aim was to bring needy homeowners and lenders together at large public events to work out modifications that drop interest rates and payments.
Some, like Douglasville's Michelle Godfrey, were able to meet face-to-face with their lenders at the events, or individually, and keep their homes.
Godfrey said she was in trouble after her marriage broke up, leaving her with the house but not enough income to pay the mortgage.
Her CredAbility counselor put here on a "strict debt diet," Godfrey said, and she took on two part-time jobs to supplement her income in food service. She was able to get a loan modification that dropped her monthly payment from $923 a month to $513.
The program saved her home, she said.
Not every family that reaches out to the HOPE Now campaign gets satisfaction.
Gerald Hall of Lawrenceville went to one of the events in Atlanta last June and has been frustrated by the lack of results.
He tried for a modification but was told recently he has to start the process over again. Meanwhile, foreclosure proceedings have ruined his credit, making his life more difficult.
Dalton, speaking during a visit to CredAbility Wednesday, said there is more work to be done. "We know that this crisis is a long way from being over," he said.
He said the work will be helped by Congress restoring $45 million this week in the proposed budget for housing counseling. It had previously cut counseling money, with the result that some counselors in metro Atlanta were laid off.
"We are pretty confident that is going to be signed into law," Dalton said.
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