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14.5 Office of Housing Counseling

<< Title XIV Overview

14.5 Office of Housing Counseling

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14.5.     Office of Housing Counseling.  The Act also establishes the Office of Housing Counseling in HUD. [§1442]  The Office will be headed by a Director, appointed by the HUD Secretary. 

                        14.5.1.    Purposes. The Office of Housing Counseling will develop programs and activities for homeownership counseling, rental housing counseling, and campaigns to promote housing counseling.

                                    14.5.1.1.           Grants for HUD-Certified Counseling Operations. The Office will provide grants to states, local governments, and nonprofit organizations for housing counseling assistance. [§1444]  $45 million is appropriated for the 2009 through 2012 fiscal years for the grant program. Programs that receive grants must use HUD-certified counselors. [§1445]

                                    14.5.1.2.           Standards for Homeownership Counseling. The HUD Secretary, will set standards for materials used by homeownership counseling services. [§1443]

                                    14.5.1.3.           Mortgage Software Systems. The HUD Secretary will also provide certification of mortgage software systems used to evaluate different residential mortgage loan proposals for consumers. The HUD Secretary must also take steps to make sure the software is widely available.

                                    14.5.1.4.           National Public Service Multimedia Campaign. The Director will develop a public service campaign for various groups, including those in risk of foreclosure and considering a subprime loan, that it is advisable to obtain unbiased homeownership counseling. The campaign will also promote the availability of such counseling programs, including those sponsored by the HUD Secretary.

                                    14.5.1.5.           Foreclosure Rescue Education.  The Director of Housing Counseling is to conduct foreclosure rescue education programs in areas that have a high density of foreclosure. Ten percent of the funds appropriated for the national public service campaign must go to the foreclosure rescue education program.

                        14.5.2.    HUD Study on Default and Foreclosure. The HUD Secretary is also required to study the root causes of default and foreclosure of home loans. [§1446] The preliminary study is due 12 months from the date of enactment of the Act, and the final report is due 24 months after enactment.

                        14.5.3     Default and Foreclosure Database. The HUD Secretary and Director of the Consumer Financial Protection Bureau will establish a database on foreclosures and defaults. [§1447] The database will include information on the number and percentage of delinquent mortgages, the number of mortgage loans that are in foreclosure, and the number of mortgages that are underwater.

                        14.5.4.    Mortgage Information Booklet. The Director of the Bureau will prepare, at least once every 5 years, a booklet to help consumers applying for federally related mortgage loans. [§1450]

                        14.5.5.    Home Inspection Counseling. The HUD Secretary is to publish materials informing potential homebuyers of the availability and importance of obtaining a home inspection. [§1451] HUD-certified counseling services must make these materials available to their clients.

                        14.5.6.    Warnings to Homeowners of Foreclosure Rescue Scams.  The Neighborhood Reinvestment Corporation is to use amounts provided under the Housing and Urban Development Act to inform borrowers about the complexity of the foreclosure process and the risk of foreclosure rescue scams. [§1452]