How to hold onto your household

April 3, 2009; As originally appeared in the Norwalk Citizen

Carlos Santiago's problems began with his stroke three years ago and have been exacerbated by the economic downturn.

Santiago, a Bridgeport resident, worked as a mechanic all his life to support his family. Like many hard-working Americans, he bought a house he was proud of, had a job that paid the bills and saved money when he could.

Though he survived the stroke, he was left with a battery of lingering health problems and a handful of different medicines he must take every day to preserve his health. Because his job demanded mental acuity and physical labor, he was forced to stop working. That was when the financial difficulties began.

To make matters worse, one of the apartments that Santiago normally rents out of his house remains empty.

Santiago and his wife who endured a severe car accident and also can not work were able to live off of savings for two years. But the well has run dry. For the Santiagos, mortgage payments have become impossible, as disability payments cover only a fraction of that expense. Santiago is being confronted with the grim possibility of having to give up his multi-family home of 20 years.

Santiago was among other local citizens many with strikingly similar situations in attendance at the Benjamin Franklin Community Center in Norwalk last Saturday for a Foreclosure Prevention Forum held by 4th District Congressman Jim Himes.

The workshop brought together government officials, community organizations and foreclosure prevention specialists to connect homeowners facing foreclosure with programs and services that can help keep families in their homes.

"The point today is to make everyone aware of the resources that are out there," Himes said, calling foreclosure a "life-changing event" millions of Americans are now up against.

Himes cited components of the recently passed Helping Families Save Their Homes Act, which includes incentives to encourage lenders to negotiate affordable mortgages for struggling homeowners. The plan is expected to help seven to nine million families restructure or refinance mortgages to avoid foreclosure. It is also expected to address the problem of declining property values in the face of millions of foreclosed homes in neighborhoods nationwide.

Enterprises like Fannie Mae and Freddie Mac are also now required to modify mortgages, Himes explained.

He said, because of acts like Helping Families, those currently facing foreclosure "will have a different experience than they did a year ago." In addition, he cited the Foreclosure Mediation Program, another resource available to help Connecticut homeowners reach agreements concerning foreclosed properties. Under that program, homeowners or borrowers in the state whose one to four-family homes are the subject of mortgage foreclosure action are eligible for assistance, assuming the home is a primary residence.

Alongside Himes were State Sen. Bob Duff (D-Norwalk), Norwalk Mayor Richard Moccia, State Rep. Chris Perone (D-Norwalk), Norwalk Town Clerk Andy Garfunkel, Tom Long of The Workplace, Inc., Valencia Taft of the Connecticut Housing Finance Authority, Joan Carty of Housing Development Funds and Carol Sydnor of the Mutual Housing Association of Southwestern Connecticut.

Long urged those at the forum struggling with unemployment to pursue avenues like The Workplace, Inc. a non-profit that provides employment and training services for Fairfield County to get back into the job market by improving credentials that can help boost earnings potentials.

"Whatever you do, do not do this process alone," Sydnor added.

Himes urged the public to take advantage of programs like Darien-based People to People, which makes emergency payments on mortgages in times of need. He and Moccia also warned against scams preying on vulnerable homeowners.

"An HUD approved mortgage counselor will not ask for money up front," Himes said.

Schemes where fraudulent agencies are taking advantage of the foreclosure crisis are becoming more and more commonplace, Himes said, and are one of the dangerous pitfalls homeowners must watch for in navigating difficult financial waters.

"We're far from getting past this process," Perone said. For information about the Foreclosure Mediation Program, visit www.jud.ct.gov. For information, visit www.hud.gov or www.fha.gov.