Preventing Foreclosure is Good Business!

The last thing most lenders want to do is foreclose on someone’s home. It’s difficult. It’s painful for everyone involved. And it’s very expensive.

One mortgage industry firm estimated that a single foreclosure can cost up to $50,000. Besides hefty attorney fees and document filing expenses, lenders may also be forced to hire a real estate agent and pay sales commissions to get the home off their books. What’s more, many foreclosed homes on the market fetch less than the normal market price.

Add all of those factors together, then multiply them by the rising number of foreclosure cases across the country. In Michigan alone, according to a recent Federal Reserve study, the cost of foreclosures to lenders could top $400 million per year.

A Better Alternative... You Can Help!

Not all foreclosures can be avoided. But in many cases, non-profit organizations like Home Repair Services can work with homeowners and lenders to find another way. In the last three years, we’ve helped avoid more than 780 foreclosure cases in Kent County. The cost for these services, paid for entirely with donations and grants, is about $881 per case.

About 64% of the foreclosures we prevented in 2007 were “work-out” solutions in which the lender agreed to alter the requirements of the loan and no additional community funds were necessary. The remaining solutions have involved some sort of financial assistance to help the homeowner pay the arrearage and get back on track with their payments. In 2007, Home Repair counselors coordinated more than $151,000 of financial assistance for foreclosures from various organizations, agencies, churches and individuals.

Best of all, we get lasting results. An independent accounting study showed that 72% of the homeowners we helped were still current on their mortgage payments almost two years later. To continue this important work, we need your financial support. Please consider making a tax-deductible gift to Home Repair Services. It’s not only good for the community – it is good business, too!