Hope Now Alliance


DEFINITION of 'Hope Now Alliance'

An initiative launched in 2007 to combat the rising tide of foreclosures created by the subprime mortgage market meltdown. The Alliance is comprised of members from the U.S. government, the secondary mortgage market, lenders, mortgage backed securities (MBS) investors and homeownership counseling organizations. The group's efforts to reverse the foreclosure trend focused on contacting homeowners for loan modifications and workouts. Workouts can result in either a modified repayment plan (simply bringing the homeowner up to date on their current payments but not changing the underlying terms of their mortgage) or a loan modification (where the terms of the mortgage are modified in order to make the loan serviceable for the homeowner).

Tactics have included a nationally-promoted website with foreclosure prevention information, a 24-hour toll-free telephone number and free phone counseling through the Homeownership Preservation Foundation.

BREAKING DOWN 'Hope Now Alliance'

The Hope Now Alliance claims that as of September 2009 it has helped over 1.7 million distressed borrowers, but the actual number of borrowers who have received long-term help (meaning that they are permanently not at risk for foreclosure as a result of their loan workout or modification) is unclear. Critics at the time claimed that the Alliance did not do enough to aide distressed borrowers, that rollout of the group's assistance was uncoordinated leaving homeowners confused and still at risk for foreclosure and that its member firms was slow to move in part because as lenders and investors they stood to lose money on their investment if borrowers received loan modifications that lowered the amount of money owed on their loan.

  1. Forbearance

    A temporary postponement of mortgage payments.
  2. Foreclosure - FCL

    A situation in which a homeowner is unable to make principal ...
  3. Subprime Meltdown

    The sharp increase in high-risk mortgages that went into default ...
  4. Mortgage

    A debt instrument, secured by the collateral of specified real ...
  5. Delinquent Mortgage

    A mortgage for which the borrower has failed to make payments ...
  6. Loan Modification

    A modification to an existing loan made by a lender in response ...
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  1. Do FHA loans have prepayment penalties?

    Unlike subprime mortgages issued by some conventional commercial lenders, Federal Housing Administration (FHA) loans do not ... Read Full Answer >>
  2. Can FHA loans be refinanced?

    Federal Housing Administration (FHA) loans can be refinanced in several ways. According to the U.S. Department of Housing ... Read Full Answer >>
  3. Can FHA loans be used for investment property?

    Federal Housing Administration (FHA) loans were created to promote homeownership. These loans have lower down payment requirements ... Read Full Answer >>
  4. Do FHA loans have private mortgage insurance (PMI)?

    he When you make a down payment from 3 to 20% of the value of your home and take out a Federal Housing Administration (FHA) ... Read Full Answer >>
  5. How many FHA loans can I have?

    Generally, the Federal Housing Administration (FHA) does not insure more than one mortgage per borrower. This is to prevent ... Read Full Answer >>
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    Loans insured by the Federal Housing Administration (FHA) on or after Dec. 15, 1989, are assumable by qualifying borrowers. ... Read Full Answer >>

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