Helping Americans Keep Their Homes: Institute Announces $2.4 Million More in Grants to Help Families Fight Foreclosure
The Institute for Foreclosure Legal Assistance today announced it has awarded $2.4 million in grants to nine legal-aid offices in as many states. The grants are the second and final round in a multi-year program to bolster local groups nationwide who assist the growing legion of borrowers facing foreclosure. Last year the Institute awarded $6.5 million to 27 groups in 19 states and the District of Columbia.
The Institute, a project of the Center for Responsible Lending and managed by the National Association of Consumer Advocates, made the second round of awards to groups in communities not served by the first-round of grantees but especially hard hit by the ongoing wave of foreclosures. The grants range in size from $250,000 to $300,000 and will be provided over three years, with annual reviews. The money will enable the recipient groups to hire additional attorneys specializing in foreclosure prevention.
Last year’s awards were made to nonprofit groups that demonstrated they already had successful foreclosure prevention programs in place but needed more resources. The grants ranged in size from $75,000 to $375,000, and also were spread over three years. The accomplishments of these groups, which are about to receive their second-year funding, include hiring 50 additional staff attorneys who now actively work on homeowner protection projects across the country. IFLA attorneys have assisted over 1200 clients, trained direct local service providers on identifying clients who need legal representation and participated in community outreach events geared to reach homeowners at risk of foreclosure.
"Legal service attorneys are playing an essential and insufficiently recognized role in fighting against our nation's terrible foreclosure plague,” says NACA executive director Ira Rheingold. “I’m sorry we can’t fund more programs and hope Congress and the Administration will allocate the money necessary so more families across our country can receive the help only legal service attorneys can provide."
The Institute also will continue to fund several related activities designed to maximize the effectiveness of the grant program. Among these are handling cases directly that the Institute’s managers believe will set important legal precedents for helping families avoid losing their homes; and administering a fund that helps attorneys, including non-grantees, pay for expert witnesses, travel and other out-of-pocket litigation costs. IFLA has disbursed $218,500 for 8 litigation cases from this fund; it expects to recover that money as cases are won or settled.
"IFLA grantees are on the front line of the foreclosure crisis and are making a tremendous difference in their communities," said Eric Halperin, director of CRL's Washington DC office. "The sad fact is that there are so many more in need than our funding can accommodate."
The Institute was created in the fall of 2007 through a generous donation from the investment firm Paulson and Co. Inc. Its one mission is to help meet the growing need for quality legal assistance for families who are victims of a housing crisis created by reckless mortgage lenders.
More than 2 million families already have lost their homes to foreclosure since 2007, forced out as teaser rates on their loan jumped to unaffordable levels. Already twice as high as normal, the
number of foreclosures will accelerate for the next four years. This year alone more than 2.4 million families face the grim prospect of losing their home, with similarly large numbers projected to do so in each of the following three years.
In addition to the families directly hurt, tens of million of neighboring families will see the value of their homes fall hundreds of billions of dollars just because they live near foreclosed properties. Despite an 18 month effort by federal officials to prod industry to voluntarily modify loans, lenders and servicers simply have not and are not doing so fast enough or in sufficient numbers to make a difference to communities or the economy.
The National Association of Consumer Advocates (NACA) is a nationwide organization of more than 1500 attorneys who represent and have represented hundreds of thousands of consumers victimized by fraudulent, abusive and predatory business practices. As an organization fully committed to promoting justice for consumers, NACA's members and their clients are actively engaged in promoting a fair and open marketplace that forcefully protects the rights of consumers, particularly those of modest means. For more information visit www.naca.net.
For more information about the Institute, about obtaining a recoverable grant for litigation expenses, or about being trained in foreclosure prevention law, please visit www.foreclosurelegalassistance.org.
IFLA mission statement and goals
As the nation's foreclosure epidemic continues to worsen, the Center for Responsible Lending has formed the Institute for Foreclosure Legal Assistance (IFLA) to support groups giving legal representation to families facing foreclosure and financial ruin because of abusive subprime mortgages. The National Association of Consumer Advocates will manage the project, which recognizes that one of the biggest barriers families face to avoid losing their homes is the lack of access to quality legal services.
The Institute, launched with a $15 million grant from investment management firm Paulson & Co. Inc., will provide funding and training to organizations that help homeowners negotiate alternatives to foreclosure. The majority of the funds will be grants to support direct legal assistance to borrowers in 10 or more states to fight foreclosure, predatory lenders and abusive loan servicers. It will do this primarily by providing money to top non-profit legal-aid groups and law school clinics.
Message from the Institute Advisory Board
The Institute for Foreclosure Legal Assistance provides funding and training to organizations that help homeowners fight foreclosure. In pursuit of that mission, the Institute has appointed a 4-person advisory board made up of a diverse group of nationally recognized experts dedicated to helping solve our nation's mortgage crisis. The panel members, who have no set term limit, provide leadership, guidance and advice to the Institute as it seeks to use its funds for the protection of homeowners and the advancement of proactive legal solutions to significantly diminish the flood of foreclosures causing despair and ruin throughout our nation's communities. The four board members are: Janis Bowdler, National Council of La Raza; Prentiss Cox, the University of Minnesota Law School; Nina Simon, AARP; Michael Waldorf, Paulson & Co.