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November 2016

Wells Fargo Provides Grant for HLP.Guru to Qualify More Home Buyers The Wells Fargo Housing Foundation recently made a grant to HLP to provide potential home buyers with access to HLPGuru to help them qualify for a mortgage loan.

Take 5 Milt Sharp, Jr. describes how eHome Network, an online education and counseling program, assists first-time home buyers Page 2

Survey Says Nonprofit housing counselors respond to our latest survey on technology, lenders and servicers

Wells Fargo is the fourth national company to agree to provide HLPGuru to its declined appli­cants. The others are NationStar, Ditech, and Finance of America. The Foundation’s grant will provide free access to HLP’s new tool for 750 families that have been declined for a mortgage and help them become mortgage ready. As part of a six-month subscription, each family will receive a personal action plan and tools to improve their credit, debt-to-income ratio, and ability to save for a down payment. “We are proud that Wells Fargo chose HLPGuru to help families pursue homeownership”, said Mark Cole, Executive Vice President for HLP. “HLP.Guru represents a bridge between the old way of lend­ing, counseling and shopping for a home. Today’s homebuyers are looking for a very different experience and we believe that marrying sophisticated analytical tools with on-demand, objective coaching of nonprofit housing counselors is a game changer for increasing homeownership rates and long-term success.” …continued on page 3

Page 3

Robust Security Infrastructure in Place for HLP.Guru Cam at MBA HLP’s regular presence at key mortgage industry events continued this October in Boston Page 4

HLP has been a leader in security and data protection since its inception. Best practices such as a SOC2 environment, PCI scanning, comprehensive policies and procedures, business continuity planning, plus regular audits and reviews by financial institutions and independent auditors ensure a safe, stable and secure platform for all of our customers. This approach has been imbedded in the launch of its latest offering, HLPGuru. This tool is hosted on a technology infrastructure that is independent from those involving loan mod­ifications, foreclosure mediation and other products designed for mortgage servicers and is uniquely designed for the needs of homebuyers.

…continued on page 4


Milt Sharp, Jr. is the president and national administrator for eHome Network, an online education program that assists first-time home buyers. Prior to joining eHome America, Sharp was the director of NeighborWorks America’s Homeownership Centers, Financial Capability work and Full Cycle Lending Certification.

How does eHome Network work?

We offer a suite of products that links online education with one-on-one housing counseling. The program was developed by Community Ventures Corporation, a nonprofit housing counseling agency in Lexington, Kentucky, to meet the needs of rural residents that needed to travel an hour or more get counseling. Approximately 58,000 prospective homeowners took our classes in 2015 and we’re on track to help between 85,000–90,000 people this year.

How do you work with counseling agencies? We provide 24/7 access to financial education and counselors help them with more technical issues, such as finding down payment assistance and paying for closing costs. Our course takes about six hours and is done in modules, so each person enrolling in the course must pass a learning check. Counselors can see how well the consumer has performed to make certain they understand a wide range of issues, from their credit score, need to pay down debt and access to down payment assistance. We have more than 450 partner agencies in all 50 states plus Puerto Rico, Guam and the US Virgin Islands. More than 400 of our partners are housing counseling agencies and the vast majority of those are HUD-approved.

Why has eHome Network been successful?

Today’s consumer wants to receive education online. They want access that is convenient and timely. It’s far more appealing than a face-to-face class where a person needs to

enroll, make an appointment, drive 30 minutes or more and be there for hours. But they also want human interaction, so the follow-up counseling session where they receive detailed information from a certified housing counselor is critical. Our funding model also works well. Our course fee is $99 and people are willing to pay for that service. We also share these fees with our partners, providing them with approximately $7.5 million in revenues the last two years.

How can lenders and counselors help improve the rate of homeownership? We can start by debunking many myths, such as the idea that a person needs to save 20 percent of the home price for a down payment. Next, we must find ways to fast track those people that qualify for a loan without making them go through classes and other meetings if they are ready. In effect, we need to do a better job of triaging the customer. Finally, we need to charge a fair price for our services and incorporate cost-efficient tools, such as online education and telephone counseling.

What are the opportunities for counseling agencies? Many millennials have student loan debt, so we must address this issue. They can’t buy and move into homes if they have this debt and a mortgage payment. I think much more training is needed to help agencies and their counselors deal with this issue. It requires a specific skill set that many agencies don’t possess


H L P M O N T H LY S U R V E Y

Are Counseling Agencies Tech Needs Being Met? Technology seems to be working well for many nonprofit housing counseling agencies, though others see room for improvement, according to HLP’s latest monthly survey. Asked if their current technology is meeting their needs, 48 percent of the agencies said they are “very satisfied.” Forty percent of the respondents said they are “somewhat satisfied” with their current technology, indicating that upgraded technology could

very satisfied

improve productivity and make the agencies more efficient. somewhat satisfied

While accounting for a small percentage of the total, 12 percent of agencies respondnot satisfied

ing said they are not satisfied with their current technology.

Are Mortgage Companies More Cooperative? Nonprofit housing counselors say that it’s getting a bit easier to work with lenders and mortgage servicers. According to HLP’s latest monthly survey, 40 percent of the nonprofits that responded report that mortgage servicers are more cooperative now compared to 12 months ago. The respondents also gave improving marks to lenders, with 36 percent saying that lenders have been more cooperative over the same period. While these results are encouraging, some agencies report that there are still problems. Twenty-eight percent of the agencies reported that servicers have been less cooperative, and 16 percent say that lenders are less helpful.

SERVICERS

LENDERS

cooperation level

cooperation level

…Wells Fargo–continued from page 1

Each family will also receive access via telephone or online chat to a “guru”—a certified non­ profit housing counselor. These gurus will help each family develop and implement their plan for homeownership. Participants typically gain 30+ points on their credit score within six months and 35 percent become homeowners within 12 months of enrollment. To create its new app, HLP teamed up with CE Analytics to develop HLP.Guru. The app gives consumers access to the same powerful analytic techniques lenders use to pre-qualify consumers for home mortgages. CE Analytics has provided

custom credit and borrower plans to more than 3 million con­sumers over the past decade. HLP.Guru’s other key features and benefits include: • Enhances the ability for all stakeholders to collaborate in a secure environment; • Meets security and compliance requirements for the exchange of client and financial institution data. • Provides centralized administrative tools, reporting and analytics that increase opportunities for success; and • Minimizes infrastructure and the need for technical expertise through software-as-a-service.


Melchiorre Attends MBA Conference HLP’s regular presence at key mortgage industry events continued in late October when Chief Executive Officer, Cam Melchiorre, attended the Mortgage Bankers Association’s annual meeting in Boston. Melchiorre, who has more than 30 years of experience in the mortgage industry, met with dozens of industry representatives and touted HLP’s technology platform, the recent addition of new servicers and HLP.Guru, the new web app created to drive new loan originations. Melchiorre continues to participate in key industry decisions Melchiorre

as a member of the MBA’s Loan Administration committee, which met at the conference.

…Security–continued from page 1

HLPGuru is HLP’s new tool that helps consumers better understand the mortgage loan process and qualify for homeownership. Working with a “guru”—a HUD-certified housing counselor—anyone can develop a plan to improve their credit score and qualify for a mortgage loan. NationStar, Ditech and Finance of America have already agreed to enroll their declined applicants in HLP.Guru to help them qualify for a mortgage loan. “As we diversify our product portfolio, we want to ensure that consumers are continuously protected throughout their relationship with us and mortgage lenders,” said Louann Bernstone, HLP’s senior vice president of Risk, Governance and Compliance. In addition to our standard security and data protection protocols, the new HLP.Guru platform is EI3PA certified. This means

mark.cole@hlp.org

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202.803.7933

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that an independent, certified assessor has audited our environment, attested to the security of the data and has ensured that it com­plies with federal, state and credit bureau regulations. To ensure the platform is secure, auditors are now reviewing its hardware, software and all controls as part of a recertification process. Bernstone says that HLP’s security review and improvement efforts are a continuous, evolving process to ensure security will not be breached. For example, HLP does not store clear text data on our devices. Records in HLP.Guru are hashed to keep consumer data obscured and connectivity to our environment is over secure channels. Once a consumer exits the HLP.Guru program, data is expunged from HLP’s system to ensure the utmost privacy for the consumer.

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HLP News—November 2016