Transcript Slide 1

Helping Mortgage Borrowers Keep Their
Homes by Improving Their Earning Potential
May 28, 2009
U.S. DOL Region 3
Recovery &
Reemployment Forum
Jo Shute
The WorkPlace, Inc.
In June 2008,
Connecticut legislators set aside
$2.5 million* in bond funds to create
a workforce system response to the
mortgage crisis.
Sub-prime Loans
Poorest people in urban
districts are impacted most
Top 3 Cities
26,913
30 towns
46,035
58%
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The program is working to help
resolve mortgage issues, now
compounded by growing
unemployment.
CT Unem ploym ent
160.0
140.0
5.3%
Mar’09
7.5%
80.0
60.0
40.0
20.0
0.0
08
Ju
l-0
8
Se
p08
N
ov
-0
8
Ja
n09
M
ar
-0
9
Mar’08
100.0
M
ay
-
CT Unemployment Rising
# residents (000)
120.0
This is the story of how it
happened, results to date, and
learnings that you can apply to
your challenges.
Top 20 States by Rate of
Foreclosures (1st Qtr 2009)
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Nevada
Arizona
California
Florida
Illinois
Michigan
Georgia
Idaho
Utah
Oregon
1/27
1/54
1/58
1/73
1/135
1/136
1/138
1/147
1/151
1/153
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
Ohio
Colorado
Virginia
Indiana
Connecticut
Maryland
Tennessee
Rhode Island
New Hampshire
Arkansas
1/160
1/169
1/222
1/223
1/245
1/250
1/263
1/265
1/267
1/281
Total Properties with foreclosure filing reported (these 20 states, March’09): 286,303
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Sources: RealtyTrac Note: RealtyTrac foreclosure numbers based on a count of the total number of properties with at least one foreclosure filing reported
during the month. 1/HH
AHA! (core concept reinforced)

Insight: Loan modifications alone don’t eliminate
delinquencies
Nationally, more than ½ of loans modified in 1Q + 2Q ‘08 fell
delinquent within 6 months

Opportunity: MCJTP uses extended workforce system to
help borrowers increase their earning capacity
 ability to pay mortgage
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Education pays…
in higher earnings & lower unemployment rates
$80,860
$79,144
$63,856
$50,856
$38,272
$33,540
$30,732
$22,152/year
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MCJTP helps borrowers gain the skills they need
to be able to earn more money to become
financially stable.
Services:

The program offers:
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Customized Employment
Services
Job Training Scholarships
Job Placement Assistance
Financial Literacy
Credit Counseling
Referrals to other needed
services
8 Program Specialists; assigned
to customers geographically
Eligibility:

60 days or more past due on
mortgage

Mortgage is for primary
residence in CT

Household income less than
$120,000

Referred by the Connecticut
Housing Finance Authority
(CHFA), or can demonstrate an
imminent need for services
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As of 5/1/09:
(7 full months in operation)


Referrals to the program
Assessed for Program Eligibility
2,350
785
(one-on-one discussion with Program Specialist)


Training Scholarships
Provide Career Coaching
368
519
(includes info on in-demand careers
and required skills; guidance on training)

Employment Support Services
643
(Resume Prep, Interview Prep,
Assistance with Employment Applications)


Referral to Financial Literacy
Credit Counseling
382
196
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Customer Profile:
A Connecticut Example
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College Educated – many have Associates
or Bachelors Degree
Mix of employed + unemployed
Occupations – Retail Sales, Bookkeeping,
Drivers, Construction workers, Clerical &
many others
Seeking Career Transition into: Health
Care, Project Management, IT
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Education & Training through
MCJTP
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368 training scholarships have been written
Average duration of training is 9 weeks
Types of training include:
Health Care:
Certified Nurses Aide
Manufacturing:
Project Management
Dental Assistant
Lean – Six Sigma Black Belt
Veterinary Technician
Central Sterile
Processing
Medical Billing &
Coding
Info Technology:
A+ Network & Microsoft Certified Professional
Pharmacy Technician
Certification
Certified Payroll Professional
As of 5/1/09
Administration:
Admin Assistant Certificate Program
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Referrals vs. Assessments
Actual Data through April - Forecast May/June 2009
3,000
Referral Sources Include:
* CHFA
* Foreclosure Mediation Program
* Department of Banking Call Center
* Housing Counseling Agencies
* CTWorks One Stop Centers
* MCJTP Toll-Free Number 866-683-1682
2,500
2,000
* Legislators
1,500
1,000
500
0
Jul
Aug
Sep
Oct
Nov
Dec
People Assessed for Program Eligibility
Jan
Feb
Mar
Apr
May
Jun
People Referred to the Program
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Who’s Weighing In?
Institution holding mortgage
2. Agency guaranteeing (e.g. CHFA)
3. Housing counseling specialist
4. Judicial Branch, Foreclosure Mediators
5. Attorneys (for Lender & Borrower)
6. Mortgage Crisis Program Specialist:
lends weight + voice
1.
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Key Partnerships

Connecticut Housing Finance Authority (CHFA)
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Connecticut Department of Banking
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Helping reach lenders and communicate program benefits
Distributing information on the program to consumers who
call their customer service center
One-Stop Centers
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Sources for Financial Literacy Training and Credit
Counseling
Providing support programs for clients and space to meet
people near their own communities
HUD Housing Counseling Agencies
State of CT Judicial Branch, Foreclosure Mediation Program
United Way of Connecticut 211 Infoline
Lenders e.g. People’s United Bank, NewAlliance Bank
Developing more through community outreach
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Why would a lender
participate?

High cost of foreclosure
Lender Cost estimates:
$60,000 (Freddie Mac)
$25,000-80,000 range(Trulia.com)
Vs. cost of foreclosure prevention counseling: $1,000-1,500
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Keep your home by getting the
skills you need
1-866-683-1682
www.workplace.org/mortgage.asp
Staff: Program Specialists Have
Diverse & Relevant Backgrounds
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Olga: Attorney focused on
commercial & residential real
estate; Legislative Asst for
members of Congress
Michael: Underwriter; 15 years
private & public sector
experience
Samone: Director Housing
Development, Habitat for
Humanity; property
management for Freddie Mac;
10 years with low-income
families and affordable housing
Rosa: Banker assisting first-time
homebuyers; 10 years in
community outreach, mortgage
counseling & employment
training
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Nicole: Attorney handling broad
range of cases; Board &
Commission roles; Justice of the
Peace
Tim: Finance & Accounting; 30
years diverse tax, financial
planning, mortgage origination,
credit education & counseling
Rose: Mortgage & Banking in
diverse roles; owner of
insurance & real estate agency;
volunteer community leader
Stephen: Human Resources &
Operations; 20 years in large
corps and small non-profits
handling business and
employee issues
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Identifying Earnings Potential
Finding The Right Path…
Intake - Interest
 Determine employment suitability, evaluate
existing strengths
Individual Employment Plan
 Determine work readiness
 Skills inventory vs. market demand
 Assess training options, duration & can it
make an immediate impact?
Case Load Prioritization
 Utilize Most-in-Need questionnaire
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Start-up Milestones
since program inception July ‘08
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Policies & Procedures developed
Data Tracking System & Electronic Referral
Process designed
Hired and trained Specialized Team
Toll-free number established: 866-683-1682
Participated in Statewide housing fairs
Cross Training with State Agency Personnel
Expansion of Eligible Training Provider List
Coordinate customized training for customers
with common needs
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Communicating Progress
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Tip of the Iceberg?
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Year 2 Plans:
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Respond to continued demand
Expand staff to close “gap” between referral
and enrollment
Increase outreach & build awareness
Coordinate more closely with other programs
Enhance state’s response to rising
unemployment
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A New Concept…
“Invest in Your Customer”
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Step 1:


Lender
Invest $
Loyal
customer
Step 2:
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Lenders participate in cost of
training (directly, in a small
way)
Chain of Benefits:
A whole class of commerce
invests in their customers to
strengthen them
Potential game-changer:

Credible
borrower
Customer
Earn more $$$$
Could apply to public utilities,
insurance, cable…
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Key Steps in Development
1.
2.
3.
4.
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6.
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10.
The idea – “follow the pain”
The concept – how could we play a (unique) role?
The pitch – talk with key parties to find fit & cultivate interest
The rationale – research, analyze data, shape the concept
The partners – identify partners and define roles
The scope – estimate $ needed to have meaningful impact
The proposal – operationalize program & refine description
The approvals – meet with key parties to gain support
The staffing – select/hire capable program manager
The kickoff – set a date for start-up & push to make it happen
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Taking It Home/Next Steps
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Consider what you’ve heard here:
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Is this issue both urgent and important for your area?
Is someone already working on it? [piggyback]
Is there a way Workforce can add value?
Would a “success” enhance the relevance of Workforce
overall?
Gather some facts; learn more about it
Discuss informally with trusted colleagues
Decide whether to embark on development!
Call on us if we can help…..
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Want to explore further?

Contact us at (203) 610-8502
[email protected]

www.workplace.org/mortgage.asp
THANK YOU!
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