For more information about Affordable Housing Resources, visit ahrhousing.org or call 251-0025.
At the height of the foreclosure crisis, Affordable Housing Resources kept many people in their homes. Now the agency is working to help more people get into home ownership for the first time.
Since its founding more than 20 years ago, AHR has had the twin goals of obtaining and maintaining home ownership, but in recent years the economic downturn has meant its buying efforts were eclipsed by those designed to keep people in their homes.
Its success is reflected in Neighbor-Works America rankings, which place AHR third nationwide for the period from October 2012 to September 2013.
During that period, AHR saved 496 homeowners from foreclosure, 50 percent of whom were outside Davidson County. The agency logged 351 the year before, and has a three-year total of 2,024 homeowners helped.
“We have set our sights as an organization and in our business to be the largest producers of home saving in the state, and we hired really good staff to make that work,” says Eddie Latimer, CEO. “They all came out of the mortgage industry and they understand it. We have a business plan, and we execute it.”
The shift to foreclosure prevention was a change from AHR’s historical mission of helping to put people in homes, both from a business and customer-relations standpoint, Latimer says.
“When you are putting someone in his or her first home, it’s a very positive environment,” he explains. “Foreclosure is a hard environment. People have lost their jobs, they have never taken a handout from the government or anyone else, and you are dealing with a lot of emotional and motivational issues. It’s much more bleak dealing with these customers, so we were challenged.”
The average AHR customer during the last two years has been 50 years old, owned his or her home for around 20 years and become unemployed.
AHR has been able to offer them assistance through forgivable loans through Keep My Tennessee Home and the Hardest Hit Fund, programs from the U.S. Treasury and the Tennessee Housing Development Agency, as well as loan-mitigation programs such as the National Foreclosure Mitigation Counseling Program, that work with mortgage lenders.
All of these come with specific terms the homeowners must honor, Latimer says, but AHR is having success with their administration.
“The only reason these people are in trouble is the economy, and they are responsible,” he says. “When they come in, the program gives them some hope. We are one of only 19 states with the Hardest Hit program, which is for people who lost their job.”
One of those was Marteen Ryan, who had been unemployed for a couple of years, had gone through a divorce and dealt with some medical problems. As she puts it, “I qualified under several criteria.”
“I found out about Keep My Tennessee Home by doing a web search, and then contacted AHR,” Ryan says. “I had been borrowing money from my family, and that could not continue. I filled out the paperwork to become prequalified, and then went through the sessions and provided more paperwork.
“There’s a lot to do, especially if your bank is like mine and is being uncooperative.”
The staff at AHR stuck with her as she made her way through the process, and even though her mortgage lender continued with foreclosure proceedings, she remained hopeful.
“I was confident that the program would approve me, but the bank kept denying it every step of the way,” she says. “AHR was fabulous. I got the call from AHR that the bank accepted the deal two days before the foreclosure date. It was harrowing, to say the least.”
She must remain in her home for at least five years and meet other qualifications for the loan to be fully forgiven, but she says she’s hopeful that the job market will turn around and this assistance is the first piece of good news in a long time.
“AHR answered my questions and took care of me,” Ryan says. “I have two college degrees and a master’s degree. I keep hearing I’m overqualified. I’ve never taken help of any kind, and I am incredibly grateful to have found these people.”
Those are the stories Latimer likes to tell, but he says with the improving economy AHR is going to begin turning its focus back to first-time buyers. Congressional tinkering with the Dodd-Frank Act and other legislation has made that hill a tougher climb, he says, and so this is a good time to dive back into those waters.
“We are working on creating a product that will help those first-time buyers,” he says. “Right now there’s nothing out there, because the FHA has raised rates on [Mortgage Premium Insurance] that now has to be carried over the life of the loan, and that’s taken them out of the ability to serve a lot of these people.
“It adds a lot to the closing cost, and that can put them out of the market.”
In addition, he says, Ability to Repay and Qualified Mortgage Standards have shifted, with banks facing penalties and regulations for making loans that do not qualify. By partnering with AHR, which is a CDFI, or Community Development Financial Institution, the banks can duck some of those issues — and that should free up money.
“A lot of people who are just starting out have some debt, and they don’t have a lot of savings. They’re just not going to have the financial setup to buy a home that is QM-certified,” Latimer says.
And this is where AHR steps in.
“Our board is very creative, and we’re working together as a team to figure out how we can best meet the needs of the housing environment here,” he says.