HHOC Adds Foreclosure Intervention To Services
Hawaii HomeOwnership Center Executive Director Dennis Oshiro said the organization’s primary mission of helping first time home buyers get into the real estate market has not changed since the organization was founded in 2003, but it has been broadened to include assistance to home owners facing foreclosure.
Over the past six years, HHOC has helped more than 600 families purchase their first homes through a process of education and credit rehabilitation. Currently, staff and volunteers are working with more than 1,900 families in Hilo, Kona, and Lihue as well as at the main office in Honolulu.
“HHOC opens up opportunities for first time buyers who can’t afford the down payment or have insufficient income to qualify for a loan,” Oshiro said. “As high debt levels and poor credit are common obstacles, HHOC provides education and case management services to help potential home buyers improve their credit ratings and gain a better understanding of the home buying process. The fact is that there has rarely been a more auspicious time for qualified first time buyers to get into the market. In addition to record low interest rates and the $8,000 Federal tax credit, new programs have been developed to encourage home ownership and keep the market moving. In a recessionary period, the last thing the economy needs is for the real estate market to stagnate. At the same time, lenders have to be more cautious than in the past. Our role at HHOC is to create ‘successful’ home owners, which is achieved primarily through education, and to get the word out that mortgage money is still available…discouragement can be just as big a hurdle to the first time buyer as inability to come up with a down payment.”
Oshiro noted that HHOC has just rolled out its newest down payment assistance loan, DPAL, a program offered through its affiliation with NeighborWorks America. “With this new program, the applicant would need to qualify for 80 percent of the loan and put five percent down, rather than the customary 20 percent as with a conventional, 30 year fixed rate mortgage. HHOC would provide the remaining 15 percent of the loan as a second mortgage through NeighborWorks America’s subsidiary, Neighborhood Homeownership Services of America.
In order to qualify for the DPAL program, the borrower’s income cannot exceed 140 percent of Area Median Income, which in Hawaii varies according to County and family size. In addition, the borrower would be required to apply for the program and receive home buyer counseling through HHOC or another HUD-approved source. HHOC’s standard nine hour curriculum is divided into four courses, which include Managing Your Money, Understanding Your Credit, Shopping For A Mortgage, and Shopping For a Home.
According to Guy Inouye, HHOC foreclosure prevention and intervention counselor, “The home owners facing foreclosure should call us right away to work with their lender to possibly arrive at a resolution for their mortgage delinquency or potential delinquency problem. Anyone who is an owner occupant and mortgage challenged can either call us for an Intake Packet, which can be sent to them, or download a copy of it from our website: www.hihomeownership.org. After review of the packet the home owner can choose one of three tiers of service that we provide. After choosing the service that suits their needs, the home owner would follow the instructions necessary for us to access their current situation and send us their completed packet. A counselor will contact the home owner within five working days after receiving the packet and all necessary supporting documents. As HUD certified counselors we have credibility as intermediaries and can point to a number of successful interventions since we introduced the program at HHOC. Importantly, there is no charge for this service.”
Inouye recently handled a loan modification for a couple in their 30s with four children who were delinquent on their mortgage on a single family home they bought two and a half years ago. They were still current on a 30 year conventional loan of approximately $600,000 but their monthly income was insufficient to cover the monthly payments. They had reached a point where all their resources had been tapped out and a loan modification was the only alternative to delinquency. Inouye approached the lender, a Mainland bank, with a proposal for the couple and was able to negotiate an interest reduction to two percent for the first five years starting December 1, three percent on the sixth year, four percent on the seventh year, and, on the eighth year, a lock-in for the remaining term at 4.98 percent, which was the interest rate at the time the time the loan modification was approved.
The Hawaii HomeOwnership Center will participate in a Homebuyer & Homeowner Fair geared both to home owners having problems paying their mortgage and first time buyers who hope to become home owners in the near future on Saturday, February 6, from 9 a.m. to 12 noon in the Gentry Pacific Design Center at 560 North Nimitz Highway. Counselors will be available for consultation. In addition to the Hawaii HomeOwnership Center, exhibitors will include home developers, lenders, other non profit organizations, and government agencies. The event flyer is available at www.hihomeownership.org.
HHOC is listed as a HUD-Certified Agency for both home buyer education and foreclosure intervention. Licensed real estate agents and lenders donate their time to conduct classes at HHOC, and both the Hawaii Association of Realtors and Honolulu Board of Realtors make annual contributions to help support its programs.
The Hawaii HomeThe Hawaii HomeOwnership Center will participate in a Homebuyer & Homeowner Fair geared to both home owners having problems paying their mortgage and first time buyers who hope to become home owners in the near future on Saturday, February 6, from 9 a.m. to 12 noon in the Gentry Pacific Design Center at 560 North Nimitz Highway.