HUD Wants Housing Counseling Funds Back
The Department of Housing and Urban Development is asking Congress to restore funding for its housing counseling program, which it says is “important to the recovery and stability of our housing markets.”
The program faced major cuts in April. Congress slashed $88 million in HUD nonprofit counseling funds for 2011.
“This cut jeopardizes the vital consumer protections housing counselors provide nationwide, and restoration of these funds is important to the recovery and stability of our housing markets,” Deborah Holston, HUD’s acting deputy assistant secretary for single family housing, told a House subcommittee Wednesday.
About half of the clients in the counseling program in 2009 and 2010 sought foreclosure prevention assistance. HUD points to research such as from the Government Accountability Office that found counseling resulted in fewer defaults. Also, borrowers who received National Foreclosure Mitigation Counseling program funds before a loan modification had a 53 percent better chance of bringing their mortgage up-to-date.
“This program has far-reaching effects throughout our economy, and the services it supports will continue to be vital to the ongoing recovery,” Holston told the subcommittee.