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Report Details Colo. Foreclosure Hotline's Success

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Apr 11, 2008 9:30 am US/Mountain

Report Details Colo. Foreclosure Hotline's Success

Federal Reserve Wants Other States To Learn From Hotline

Reporting
Jodi Brooks
DENVER (CBS4/AP) ― Colorado has the most successful foreclosure hotline in the nation.

The Colorado Foreclosure Hotline provides help to families already in the foreclosure process or those who have missed a payment or anticipate doing so soon. A new report shows:

-- About 8,300 residents seeking to save their homes have sought help from the hotline since January.
-- In March alone the hotline took more than 3,000 calls.
-- The hotline received about 26,000 calls from its start in October 2006 to December 2007.

The Federal Reserve now wants representatives from Colorado's Foreclosure Prevention Task Force to teach states like California, Florida, Nevada and Arizona about how to make such a hotline a success.

The report indicates that 80 percent of those who sought help managed to avoid foreclosure. Sometimes the key is simply learning about all the options when dealing with a lender.

"If a person will make an appointment and meet with a counselor, four out of five times or 80 percent of the time we can help them avoid foreclosure," said Kathi Williams, the Colorado Division of Housing Director.

The agency credits its success to the fact that the counselors work one-on-one with people and know the language of the lenders.

"What we have done is we brought out the five major lenders that have made loans in Colorado," said Williams.

The counselors know exactly what a lender needs to know and what will be effective.

"Unfortunately most folks don't have all the tools and knowledge necessary to know what kind of information they need to be sharing with a lender," Williams said.

During 2007, about 70 percent of calls came from Adams, Arapahoe and Douglas counties. In 2007 number of calls each month ranged from a low of 1,100 in November to 2,625 in April.

"If you can't think of a solution, you think there are no solutions and that's one of the best things a housing counselor can do is open your eyes to the many solutions and opportunities that are out there," Williams said.

How The Hotline Works

The hotline is a public-private partnership aimed at helping homeowners deal with foreclosure. It is staffed by 26 nonprofit housing agencies.

Callers are connected to people in their own community using the zip code where they live. They can get information about how to stop the foreclosure process and have someone negotiate directly with their lender.

Counselors can even connect homeowners directly with mortgage lenders who may be able to restructure the terms of their loan.

"If you wait in the foreclosure process your chances of losing the property are greater as the days go on," Zach Urban with Brother Redevelopment Inc. told CBS4 after the hotline first launched.

Lenders, including Chase Bank, are also actively participating in the hotline. They've set up a team that will work directly with housing counselors and borrowers to get a situation resolved quickly. Their goal is to have a resolution in as little as 2 days.

Callers won't receive financial assistance but will get access to information and negotiation.

Additional Resources:

Call the hotline at 1-877-601-HOPE. More information is available on the Web site coloradoforeclosurehotline.org.

(© 2009 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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