Nonprofit Housing Agencies Warn of Impact of Federal Budget Cuts

Monday, December 7, 2009 Download  RSS  Short URL  Share

Area nonprofits that offer free help to homeowners fighting foreclosure say looming budget cuts from the federal government could mean big trouble. ideastream®'s Mhari Saito reports.

When northeast Ohio homeowners need help on their mortgage, they can call the United Way’s 2-1-1 hotline. There, a trained counselor refers the homeowner to one of six area nonprofits that can give the borrower free help negotiating with their lender. Problem is, next year, the Cuyahoga County Foreclosure Prevention Office estimates that $1.5 million used to fund these local programs is set to dry up. Stephen Wertheim worries that his staff at United Way’s 2-1-1 hotline will have just as many calls, but fewer places to send them for help.

Stephen Wertheim: It means there are going to be longer waits. It means that some folks will lose their homes because there’s going to be more need than service out there.

At a congressional subcommittee hearing in Cleveland today, the head of one of the largest of these groups, ESOP, or Empowering and Strengthening Ohio’s People, told area congressmen that it is projecting a 50 percent cut in its budget next year because of the projected loss in federal funds. Cuts mean ESOP may have to close many of it’s 11 state-wide offices. And it’s not as if the foreclosure problem is getting any better. The Mortgage Bankers Association says the number of Ohioans seriously late on their mortgage payments is at an all time high.