The Obama administration is boosting funding to housing counseling agencies by 22 percent this year, Housing Secretary Shaun Donovan said in announcing nearly $73 million in grants to more than 500 national, regional and local organizations.
The grants, awarded by the Department of Housing and Urban Development (HUD) through a competitive process, are aimed at helping people become or remain homeowners or find rental housing.
Nearly $68 million in grant funding will will support the provision of housing counseling services by 24 national and regional organizations, five multistate organizations, and 484 state and local housing counseling agencies.
HUD is also awarding more than $5 million to three national organizations to train approximately 4,500 counselors to assist families with their housing needs.
HUD said organizations that provide housing counseling help combat predatory lending by helping borrowers review loan documentation and avoid potential mortgage scams, unreasonably high interest rates, inflated appraisals and other situations that can result in increased debt, default and foreclosure.
Foreclosure prevention counseling helps homeowners facing delinquency or default reduce their expenses, and negotiate with lenders and loan servicers to avoid foreclosure. HUD-approved counseling agencies also offer financial literacy training to renters and homeless individuals and families.
Counseling agencies will use $9.5 million of the HUD grant awards to assist senior citizens seeking reverse mortgages or Home Equity Conversion Mortgages (HECM) to convert equity in their homes into income that can be used to pay for home improvements, medical costs and other living expenses.