The Colorado Foreclosure Hotline was established as a public-private partnership. Discussions began in late 2005, and in 2006, the Blue Ribbon Panel on Housing, composed of various housing industry professionals, identified a foreclosure crisis on the rise. The panel also identified the effectiveness of HUD-approved housing counseling, and acknowledged that a unified network of such agencies would be essential in combating the foreclosure problem. The Colorado Foreclosure Hotline was created as a central point of contact for homeowners in danger of foreclosure, and as a means for connecting those homeowners to a HUD-approved housing counseling agency in their community.
Brothers Redevelopment, a 501(c)3 HUD-approved housing counseling agency, was awarded the bid to implement, manage, and administer what is now the most successful foreclosure hotline in the country. Brothers Redevelopment houses the Colorado Foreclosure Hotline call center, phone system, and staff, while 26 independently-operating HUD-approved housing counseling agencies are networked by the toll-free number (877-601-HOPE).
The Colorado Division of Housing plays a role in operations, serving as the fiscal conduit for funds designated to the Colorado Foreclosure Hotline through a settlement between the Colorado Attorney General and Countrywide, now Bank of America and Wells Fargo. Supplemental and outreach funds are raised through donors, the list of which (inception-to-date) includes Aronowitz & Mecklenburg; Aurora Loan Services; Bank of America; Brothers Redevelopment; Colorado Association of Realtors; Colorado East Bank and Trust; Colorado Housing and Finance Authority; Colorado Land Title; Colorado Mortgage Lenders Association; City and County of Denver; Citi Mortgage; Fannie Mae; Freddie Mac; GMAC; JP Morgan Chase; NeighborWorks America; US Bank; and Wells Fargo; with in-kind donations courtesy of the Colorado Broadcasters Association; the Federal Reserve Bank of Kansas City (Denver Branch); and Rocky Mountain PBS.
The Colorado Foreclosure Hotline number went live on October 11, 2006. Since that time, the Colorado Foreclosure Hotline has tracked foreclosure prevention housing counseling data collectively through each counseling agency’s voluntarily submitted report. In five years, housing counselors have met face-to-face with more than 39,000 Colorado homeowners and have assisted 35,000 reach a positive resolution.
In a face-to-face housing counseling session, a HUD-approved counselor will analyze a homeowner’s hardship, loan product, budget, and proof of income, and based on that information, assist the borrower in piecing together a loss mitigation packet (a collection of information sent to the lender as part of the workout process). The counselor educates the homeowner on the Colorado foreclosure process, budgeting techniques, workout options, and how to communicate with the lender. In many cases, counselors call the lender with the borrower present and effectively communicate the homeowner’s financial picture and hardship, guiding both the borrower and the lender to the option that makes most sense.