Foreclosure crisis is driving many to seek help

Eric and Lisa Jacobs are among homeowners selling to pay off mortgages and avoid foreclosure. (Boston Globe Photo / Christine Hochkeppel)

As a wave of foreclosures sweeps across the region, a number of nonprofit organizations are working with homeowners to help them salvage what they can.

The groups are trying to help homeowners refinance debt, reschedule overdue payments, or in the worst case, deal with a foreclosure.

"My goodness, we are inundated with people who are calling and coming in and e-mailing," said Sheila Yancy, the director of ACORN Housing of Boston, a nonprofit that provides free housing counseling for low- and moderate-income people. Keeping up with struggling homeowners is a problem, she said. "So many are discouraged, they just want to give up."

In addition to ACORN, organizations such as Neighborhood Housing Services of the South Shore, Brockton Housing Partnership, NID-HCA Phipps, and MassHousing are working with homeowners.

Foreclosures in the region more than doubled between 2006 and last year, when 1,211 homes were taken. Statewide, more than 7,000 homes were the target of foreclosure last year.

The hardest-hit community in the region, and among the worst hit in the state, is Brockton. Last year, 363 homes were foreclosed there, far more than any other community south of Boston, according to data from Banker & Tradesman, which tracks foreclosures.

Plymouth had the second most, with 88, followed by Quincy, 77, and Randolph, 62. Brockton was the fourth-hardest-hit community in the state. The most foreclosures were in Springfield, 493. Westwood had the fewest foreclosures in the region: one.

More than 200 homeowners packed the Randolph High School auditorium recently to attend a seminar on how to deal with a foreclosure.

The seminar, in which the homeowners met with counselors for a short time and could make follow-up appointments, was organized by US Representative Stephen F. Lynch of the Ninth Congressional District. People had called about attending from as far as Western Massachusetts and Rhode Island, although most were from the area.

Lynch said one goal of the seminar was to encourage homeowners to seek help early, before they fall months behind in their payments and foreclosure becomes almost certain. He estimated that 40 percent of the people there had run into problems because of a major medical issue, such as a sick spouse who could not work for an extended time.

One such couple, Lisa and Eric Jacobs, are trying to sell their condo in Madrid Square in Brockton before it is foreclosed on. They paid $82,000 for their home in 2000 and believe it is worth about $185,000 now. But they owe about $180,000 on first and second mortgages.

They got into financial problems using equity to pay off credit card debt and spending on home improvements. Lisa also was laid off and unemployed for 1 1/2 years, so they fell behind on both mortgages.

"We want to refinance with a company that will give us a second chance," said Lisa Jacobs. If forced to sell, she says the couple will have to move in with her mother-in-law.

Tom Gobiel is in danger of losing the Billerica house he bought in 1992. A combination of factors put the 52-year-old into trouble: He used home equity to pay for his daughter's college education; his wife died in 2005; and he was laid off, after 25 years.

He managed to keep current on his mortgage until last summer, when his unemployment pay ran out. He recently was hired again, after sending out 25 resumes a day.

Normand Grenier, the executive director of Neighborhood Housing Services of the South Shore, a nonprofit that focuses on affordable housing, said the news is grim for most people who face foreclosure.

Maybe 5 percent will be able to save their home by refinancing their debt, while most of the rest will lose their homes, he said.

"We try to offer preventive counseling, but for thousands of people, it is too late," said Grenier, whose organization just opened an office in Brockton, the Brockton NeighborWorks HomeOwnership Center, that offers both home-buying classes and foreclosure counseling.

Home-buying classes can help keep foreclosures down, he said. For example, buyers learn about traditional financial management for homeowners, such as budgeting.

"That's unlike the people who threw away the rulebook," said Grenier. "Those are the ones who are suffering."

MassHousing, a quasi-governmental lender, is providing $250 million for refinancing mortgages for those in trouble. It also offers counseling through the Homeownership Preservation Foundation.

ACORN tries first to get lenders to postpone the foreclosure while a plan is worked out, said Yancy. For example, if a borrower is three months behind and the mortgage is 8 percent, ACORN tries to renegotiate a lower, fixed rate, with the owed money wrapped into the loan.

Lenders will negotiate as long as the homeowner is employed and can make a deposit on the owed money, as well as pay the mortgage plus a little extra for four or five months, she said.

"Lenders are playing a little nicer now that everyone is breathing down their necks," she said.

Matt Carroll can be reached at mcarroll@globe.com.