The city’s nationally acclaimed foreclosure prevention program is adding a new layer of assistance for troubled homeowners, who can now get a “budget buddy” to help them avoid falling into further financial pitfalls.
“We are just launching this part of the program,” said Common Pleas Court Judge Annette Rizzo.
It is intended to help distressed homeowners develop a budget and stick to it as they emerge from foreclosure. According to Rizzo, city officials are recruiting volunteers who will work one-on-one with homeowners to develop a spending plan and then work with them long-term to make sure they adhere to their plans.
“We’re calling on a new base of volunteers, those in the financial world, those in the accounting world to help,” she said.
So far, Rizzo said, two volunteers have been recruited to launch the program.
Rizzo made the announcement Wednesday at city hall during a ceremony to recognize PNC bank for its sponsorship of a related program, the Tools for Financial Growth program, which provides financial counseling workshops for homeowners in the foreclosure prevention program. PNC kicked in $150,000 to help fund the program during its first year.
The newly launched program is an extension of the Tools for Financial Growth program, which homeowner Patrick Coleman said helped him and his wife stay on track as they worked to modify the terms of their mortgage.
“It helped me in a lot of ways,” Coleman said, one of 195 people who participated since it started earlier this year. “It reminded us to slow down on going out to certain affairs, going out to dinner at these fancy restaurants … we had to learn to pay our bills.”
In addition to instilling a sense of discipline, the program taught him some basic financial principles.
“On our credit cards, we pay that monthly fee,” he said. “Then if we have a little extra in the middle of the month we send some more money to try and build our credit up.”
He credit score remains low, Coleman said, noting that he’s working on improving the score.
“This program really helped me out a whole lot,” he said.
Philadelphia has garnered quite a bit of attention for its foreclosure prevention program, pioneered by Rizzo. It forces mortgage holders and homeowners to sit down and renegotiate the terms of the mortgage.
Noting that since the start of the recession in 2008 the stream of foreclosures has not slowed, Rizzo said she is now also trying to make sure people who saved their homes once can stay in them.
“It’s not just about determining the ability of a homeowner to enter into a really good deal with the lender/servicer but rather sustaining that deal,” Rizzo said. “To me success is no coming back.”
Since its inception in 2008, the foreclosure prevention program has kept 5,000 homeowners in their homes.
“The City of Philadelphia has long recognized that keeping people in their homes has to be one of our major goals,” said Mayor Michael Nutter. “When a property goes vacant it has an impact on the rest of the community.”