Counseling Focus Gets a Boost

Starting with the foreclosure crisis and especially during 2009, debt, credit and even small business management counseling efforts received heightened attention bound to further evolve during 2010.

Many of the country's largest banks are expanding their face-to-face counseling capacity. Others within the mortgage industry are simply expanding services and adding new tools. At yearend 2009 Chase added 24 mortgage-counseling centers and announced that in the following four months the number of such centers that provide face-to-face assistance to distressed homeowners in 14 states will total 51. According to the head of retail financial services at Chase, Charlie Scharf, the move was in response to unusually high demand for loan modifications and following the engagement of its initial 27 centers in providing complete document packages looking for permanent relief.

Counseling centers are located in major metro areas such as Cleveland, Dallas, Houston, Boca Raton and Fort Lauderdale in Florida, and Seattle. Borrowers can schedule appointments or walk in six days a week. Since they first opened at the beginning of 2009, Chase centers have provided counseling for over 60,000 borrowers.

Prodigy Law Group Inc., Irvine, Calif., provides consumers, families and small businesses professional help when dealing with legal issues brought about by a hostile economic environment, such as mortgage abuse counseling, commercial and consumer debt settlement, or bankruptcy counseling. Its Mortgage Abuse Counseling Service assists predatory lenders victims. It is designed by attorneys to identify legal violations associated with the origination and servicing of any type of mortgage loan and to counsel homeowners on the best way to hold their lender accountable for those violations.

"We've found numerous instances of abusive and illegal activity, many of which justify legal action," said Gary Patton, head of the firm's predatory lending practice. "Predatory lenders often target minorities and the elderly. However, in many cases, our clients simply want an affordable mortgage so they can stay in their homes. That's why clients for this new service are granted free access to a user-friendly online software program that assists them in preparing and submitting a professional and complete loan modification request to their lender."

Managing director Seth Heyman said the program was created to protect from predatory lenders unsuspecting borrowers who have received thousands of dollars in illicit fees that have straddled them with mortgages they cannot pay. So the firm provides clients with free access to the online mod system as a courtesy, because many of them simply want to remain in their home.

In 2009 Goldman Sachs pledged $500 million for its "10,000 Small Businesses" initiative. It included $300 million in direct support to Community Development Financial Institutions, which will in turn offer both professional counseling and financial assistance to small business owners leveraging resources and jobs over the long term.

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