News

Chris Receives Key to the City

Beyond Housing’s President and CEO was quite surprised when he arrived at the Pagedale City Hall on May 14th to participate in an annual town hall meeting when he noticed a significant portion of the staff sitting among the residents.  Upon being called up to present, he then noticed his mother and sons in the crowd.  “I said to myself, what is my family doing here?  Why are so many staff members here?”, Chris remarked after being honored.

Mayor Carter shared that since around 2000, when Chris committed to coming to Pagedale to work alongside the community, progress has been ongoing.  She admitted that there were times when she thought his ‘dreams’ for the city were long shots at best, but together they made things happen.  She talked about how during the long sometimes difficult processes his commitment never wavered, and she wondered if he ever slept.

She concluded that the City of Pagedale has benefited greatly from the millions of dollars of reinvestment facilitated by Beyond Housing for new homes, home repair, after school programs and economic development initiatives such as the Save-A-Lot grocery store and new bank, and she looks forward to more great things moving forward.  She told Chris, “Pagedale is your home, and even as you expand your efforts to all of the 24:1 communities, don’t forget where it began, this will always be home!”

Pagedale has in fact been ‘home’ for Beyond Housing’s place-based model and has demonstrated the power of municipal and organizational partnerships when both parties are truly committed to progress.  We excitedly look forward to many years of progress in the 24:1 communities.

Cindy’s Story

While the foreclosure crisis continues to affect families across America, the Making Home Affordable Program has helped over 900,000 families.  One of those stories is from Cindy, a mother and employee working two jobs in St. Charles, Missouri.

Cindy experienced open heart surgery in 2009, which put her out of work for five months.  Despite having a stable job, she fell behind in her $1,200 monthly mortgage payment.  Supporting her son in college, coping with her recovery, and meeting all of her monthly financial obligations became too difficult to manage.  “I was in a tough spot,” Cindy recalled, “but I knew I could bounce back from this.  I had to.”

Cindy sought help from Beyond Housing, a HUD-approved housing counseling agency in nearby St. Louis where Linda Ingram, Director of Foreclosure Prevention, answered her questions and assessed her financial situation.  Linda immediately suggested that Cindy apply for a mortgage modification through Making Home Affordable.

Linda told her, “It’s not about the setback, it’s how you handle it. It’s how you react when the cards are stacked against you.” Cindy took Linda’s advice, and sent her financial information and required documents to her mortgage company. For several weeks, Linda stayed in constant contact with her bank, and received the free, professional counseling from Linda on a regular basis.  “You simply cannot give up,” Cindy reported, when asked about the advice she would give to others in her situation.  “Do not take ‘No’ for an answer; you have to believe in yourself and your situation.”

Last May, Cindy was given a trial modification under the Home Affordable Modification Program (HAMP), which is designed for homeowners struggling to make their mortgage payments due to a financial hardship. “I was so relieved,” Cindy recalls after learning she was approved for a trial modification with a reduced monthly payment. “It confirmed my belief that there is hope out there.”  After three successful trial payments, Cindy’s mortgage modification became permanent, and reduced her monthly payment by over $500.

Cindy continues to work two jobs and put her son through college, but with less stress knowing that she will be able to stay in her home. Cindy’s story is similar to the over 900,000 homeowners that have been helped by MHA’s variety of programs to help homeowners avoid foreclosure. “I’m thankful for so many things, but without a positive attitude and counselors like Linda from Beyond Housing, none of this would have been possible.”

Homeowners struggling with their mortgage payments are encouraged to reach out for help as soon as they begin having trouble. Free help is available by calling 1-888-995 HOPE. Homeowners who take action are far more likely to get the most positive outcome. Call to talk one-on-one with a housing expert.

Study Finds Counseling Increases Chances for Loan Modification

Homeowners who participate in default counseling are more likely to have their loans modified, according to a study released Tuesday by the Mortgage Bankers Association (MBA).

According to the trade group’s report, policymakers have increasingly turned to education and counseling as a means to help borrowers succeed as homeowners and to remedy problems that impede their ability to make their mortgage payments.

Homeownership education and counseling has existed in the United States for over four decades, according to the report, however the scope of these services began increasing dramatically only recently. In 2010, housing counselors from HUD-approved agencies provided one-on-one assistance to some 1.4 million homeowners at risk of foreclosure.

About one-third of those counseled pursued a solution related to sustaining homeownership, such as forbearance, refinancing, modification, or reconciling delinquent payments, according to the report. HUD data suggest counseling agencies were involved in more than 301,000 loan modifications last year.

Data from federal regulatory agencies indicates that about 1.7 million loan modifications, including permanent and trial period plans, began in 2010. This means counseling conservatively played a role in about 17 percent of modifications, MBA’s researchers explained.

Of those counseled last year, HUD data shows that 2 percent were foreclosed on and 3 percent declared bankruptcy.

MBA’s study entitled, “Homeownership Education and Counseling: Do We Know What Works?”, was conducted by J. Michael Collins and Collin O’Rourke of the PolicyLab Consulting Group and sponsored by MBA’s Research Institute for Housing America (RIHA).

While the data suggests that counseling leads to an increase in loan modifications and a decrease in delinquencies and foreclosures, the researchers say caution is warranted when interpreting these results. They stress that assumptions may be biased simply because people who choose to participate in default counseling to save their home “almost certainly differ” from people who do not.

Still, the researchers at RIHA concluded that it’s safe to say homeowners who opt for foreclosure prevention counseling stand a better chance of receiving a modification, even if it is because they are more ambitious when it comes to finding a solution.

While post-default counseling has been found to be effective in turning willing, delinquent homeowners back into paying, on-time mortgage borrowers, MBA’s study found that the success rate of pre-purchase education provided to homebuyers may not be so compelling in terms of future mortgage performance.

Some industry experts and behavioral analysts might presume that potential homeowners who participate in education and counseling programs prior to buying a home will be more likely to pay their mortgages on time, but MBA’s researchers say the evidence on this point is not consistent.

Some pre-purchase programs were found to reduce the incidence of mortgage default by as much as 34 percent, but many studies found no such effects, according to MBA’s analysis. At least one study suggests such programs may result in accelerated pre-payment of mortgages, which is actually a negative for a lender’s portfolio.

About 245,000 people received pre-purchase counseling through a HUD-approved agency last year. Among them, about 17 percent were reported as purchasing a home and another 26 percent anticipated buying within three months.

“Over the past decade, concerns have been raised about the extent to which Americans as a whole are sufficiently financially literate to make the complex decisions required in the ever-changing financial marketplace,” said Collins, one of the study’s authors.

According to Collins, in theory, homebuyer education and counseling could help in three ways: 1) formalized programs can lower the costs of obtaining information about how to buy a home and obtain a mortgage; 2) objective, third-party counselors can help clients avoid emotional judgments that may not be in their long-term interest; and 3) such programs can facilitate more efficient transactions, make more information available, and reduce the level of support needed from real estate and mortgage professionals.

But again, Collins reiterated the fact that past studies on the true effectiveness of pre-purchase counseling make it hard to draw any strong conclusions.

“In summary, do we know what works? The short answer is ‘no’,” concluded Collins. He stressed though that this doesn’t mean homeownership education and counseling does not work, but drives home the point that future studies should adhere to more rigorous research designs.

MBA’s study comes on the heels of federal budget cuts that have eliminated $88 million in funding for HUD’s Housing Counseling Program.

The full report from RIHA can be found online.

Charters Must Prove Their Effectiveness

Authors: Stanton Lawrence is the Superintendent of the Normandy School District and a member of the Beyond Housing Board of Directors.  Joyce McRath is Vice-President of the Normandy School District Board of Education.

Like many in the St. Louis area, the Normandy School District was taken quite by surprise two weeks ago to hear of House Bill 473, a bill that had been stealthily introduced and was being considered by the Missouri House of Representatives. Introduced by State Rep. Tishaura Jones of the 63rd District in St. Louis, this bill would, among other things, extend charter schools to school districts that are provisionally accredited. To that point, such campuses have been limited to the St. Louis and Kansas City school districts. Based on the outcomes experienced in those examples, is there any evidence that would lead us to believe that charter schools are the best solutions for struggling school districts?

Let us take a look at the hard facts surrounding these schools. What leaps out first are the dismal track records related to the academic performance of charter schools. Currently, charter school campuses unfortunately are not performing as well as provisionally accredited school districts. That’s right — you read it correctly — charter schools are performing less well than the state’s underperforming school districts. With the exception of a couple of Kansas City charter campuses that use “selective-admissions criteria” (they accept only the best and brightest students), other charter campuses have underperformed on a grand scale.

Another issue that should trigger some concern are the communities in which charter schools are being proposed. If they are indeed a universal fix for addressing the education problems of parents whose choices are severely restricted because of circumstances related to poverty, one would think that they might also provide solutions in other communities that are more privileged. Instead, charter schools are cunningly marketed as “private schools for free” to parents whose limited knowledge of their true purpose sadly misguides them into selecting the campuses as the best options for their children.

These parents regrettably never are provided insight into issues such as inferior teacher certification standards, poor academic performance, improper fiscal oversight and myriad other issues that have historically plagued charter schools. Stated differently, the parents who opt for charter schools often make an unwise choice for their children, given the dubious track record of such campuses. Often, these campuses are not required to measure up to the same stringent guidelines in place for traditional public schools.

The Normandy School District has had to come to terms with its own set of issues related to poor performance over the past few years. The manner in which we legitimately addressed such challenges was to, first of all, acknowledge their existence. Next, the district crafted a plan of strategic action that took into account all areas of deficiency along with the measures that were required to shore them up.

Nearly a year ago, our district enacted this bold and courageous plan to put the wheels in motion for a more refined school district with a transformed culture. All district staff who were not in classroom teaching positions were required to reapply for their jobs. Teachers who were identified as underperforming were informed that they would be expected to meet newly established, more elevated levels of rigor in their classrooms and, in most instances, our teachers rose to that soaring level of performance.

We looked nationwide to seek and acquire more focused and effective campus leadership for 8 of our 11 campuses. Last and most important, the Normandy Board of Education approved a strategic plan that enumerated lofty goals that are being pursued to turn around performance in a school district that admittedly has struggled for some time. And, in the midst of all of this movement, our district absorbed the Wellston School District in what we believe was a smooth and seamless transition.

We do not expect anyone to accept the claims of instructional progress as “gospel.” We have the data which clearly indicate that academic traction has finally been gained, and we expect the momentum to be especially significant next year. While we are pleased with this directional shift, we also recognize that the establishment of charter schools in our district would immediately destabilize our efforts. As in most places, these campuses would siphon off many of our youngsters and would decimate our school district academically as well as fiscally.

But we will go one step further in our argument for public schools and against charters: We do not believe that they are the answer for any provisionally accredited school district. Until we see solid evidence to suggest that the failed experiment of charter schools has itself turned around, or until they are considered for all communities (instead of only poor or heavily African-American communities), we need to keep the line drawn in the sand regarding their expansion.

Creating Opportunities

Creating Opportunities Levels the Playing Field…A Letter to the Editor on March 19, 2011 by Rich Ryffel and Ben Akande, Chairman and Vice-Chairman of Beyond Housing’s Board of Directors

Recently the pages of the Post-Dispatch have been the stage for a lively debate about income inequality. Thomas Garrett from the St. Louis Federal Reserve spurred the conversation with his paper “U.S. Income Inequality: It’s Not So Bad.” His perspective was rebutted by Professor Mark Rank from Washington University. Mr. Garrett argued, simplified here, that the rich getting richer does not make the poor poorer and that “if I make more than you, it’s not like I’ve taken from you.” Mr. Rank countered with, simplified here, that concentrating enormous wealth in a few hands runs the risk of “distorting democracy” by allowing one’s economic power to tilt the financial agenda in his favor.

The truth is that poverty robs people of opportunity — to get an education, to maintain one’s health, to spend time with family, to live in a safe environment and to secure one’s future in old age. Today, 14.3 percent of all Americans live below the poverty level. According to the U.S. Census Bureau, it is even higher in Missouri. If families never move out of poverty, their lives always will be a struggle.

There is help. Not-for-profits, such as St. Louis’ Beyond Housing, work to provide safe, clean, affordable housing, healthy food and integrated social services that enhance and support education, community health and economic development. However, without help from the community, none of us will succeed.

The work of not-for-profits, those on the front line of fighting poverty, is predicated in no small part by the support of those on the top of the income ladder. Financial success often drives charitable giving. Some write a check to right the wrong of the situation, others support missions to defer tax liabilities and some, like our partners (Save-A-Lot Food Stores, Midwest Bank Centre and E.M. Harris), know that providing opportunity for those less fortunate makes good business sense.

Everyone should have the opportunity to reach the highest economic heights. We don’t begrudge the wealthy or believe they should have the playing field tilted in their favor. But creating opportunities for families struggling today to have a successful life for themselves and their children can happen only when people lend a hand.

Richard Ryffel • St. Louis Chairman of the Board, Beyond Housing

Benjamin Akande • Webster Groves Dean, George Herbert Walker School of Business and Technology, Webster University

Exciting Things Happening for Viking Advantage IDA Students

Students involved in the Viking Advantage IDA program face many issues as they prepare to attend college.  The program provides a number of supports for students including financial literacy training, academic readiness and ACT prep activities.  Some students require more advocacy than others.  All of them simply want an opportunity.

One student who wishes to attend Central Missouri State was connected to a group taking a trip to the school which enabled her to visit the campus.  Central Missouri State reps were so impressed with our Viking student that they offered her an additional scholarship.  She was excited about seeing livestock grazing as well as her scholarship offer.

Three students have been hired by the Scholarship Foundation, a Beyond Housing partner.  They have expressed their sincere appreciation for the opportunity to work and accelerate their savings plans.

Beyond Housing also extended a helping hand to a student whose college attendance was in jeopardy because her transcripts were held by a previous school until a tuition bill was covered.  Chris Krehmeyer was able to enlist the aid of Beyond Housing supporters to resolve the issue.

Staff took up a collection to sponsor two Viking Advantage students who wanted to participate in a college tour trip to universities in the Washington, D.C. area. And to add to the excitement, Gloria Brainsby, the Viking Advantage Coordinator has surpassed expectations in the number of students registered for the December administration of the ACT college entrance exam.  Stay tuned, we’re just getting started!