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Union Privilege Hotline, Aide for Homeowners

(Press Associates, Inc.)
    CLEVELAND (PAI)--Union Privilege, the
credit-providing and mortgage financing arm of the
labor movement, has established a hotline and other
aid for concerned homeowners who believe mortgages may
be threatened by the sub-prime lending crisis.

    The announcement, by Union Privilege President Leslie
Toif and AFL-CIO President John J. Sweeney, came at an
Oct. 15 press conference in Cleveland, one of the
cities hardest-hit by the collapse of the subprime
mortgage market.  They also released a poll for the
AFL-CIO showing most homeowners do not know the extent
of the problem or the liability they may face.

    The poll says that almost half of homeowners with
adjustable rate mortgages do not know how their
mortgages adjust or reset, and nearly three-quarters
do not know how much their monthly mortgage payments
will increase when they do.

    It is the “re-sets” on the subprime mortgages, which
have thrown those borrowers
of home loans into new and vastly higher payments,
that have produced the thousands of defaults in the
subprime market--and a corresponding crunch that hits
other borrowers as well as investors who bought
batches of the subprime mortgages.

    The Hart Research survey shows adjustable rate
mortgage holders are generally not concerned about
mortgage payments until their rates reset.  But when
their payments rise substantially, they get anxious.
Use of adjustable rate mortgages has grown
particularly in the endangered subprime market.
 
    â€œWhile many homeowners with ARMs remain personally
optimistic, 62% believe escalating mortgage rates are
hurting their communities, and 48% expect they’ll have
to cut back on everyday expenses like groceries,
clothing and gasoline when their payments increase.
For families earning $50,000 or less per year, that
number is 80%,” the pollsters reported.

    To help the worried families, Union Privilege
launched a model homeowner education program,
including the Union Plus Save My Home Hotline, to
provide information and advice to help union members
and their families avoid foreclosure. The AFL-CIO also
sponsors a trust to assist union members with
financial hardship due to disability or unemployment

    The hotline will provide free, confidential advice
24-hours-a-day, 7-days-a-week from the counselors at
Money Management International, a nonprofit,
HUD-certified housing counseling agency.  Union
members and their parents and children can call the
hotline for advice at 1-866-490-5361.
 
    â€œNearly 4 out of 10 homeowners in the poll say they
wouldn’t know who to turn to for help if they had
difficulty paying their mortgage,” Tolf said.  “Unions
are at the forefront of closing that gap.”  The
hotline will advise homeowners behind in their
payments, already in foreclosure or looking for advice
in how to budget and restructure their debt.
“Ideally, we can reach homeowners before they get in
trouble,” Tolf said.

    â€œThere is a big disconnect between what people know,
and what they think they know,” Tolf added.  “That’s
why we believe homeowner education is so essential.
61% of those who have been late paying their mortgage
in the past year don’t know where to turn for help.
These are people who need help the most.”

    â€œPredatory lending practices not only involve
sticking consumers with bad loans, but also in failing
to provide homeowners with the basic information they
need to survive in this market,” Sweeney said.  “Our
poll shows consumers are looking for government help,
but the labor movement is not waiting.  We’re reaching
out to union families to make sure they don’t fall
through the cracks.”

From Press Associates Inc. <press_associates@yahoo.com>