Jen and Mike’s Financial Capabilities Success Story

It doesn’t always require an outlay of money. Sometimes the best way to help is to listen and suggest. 

Such was the case of Jen and Mike and their three children. Jen approached Lisa Christensen, Financial Coach/Budget Counselor, inquiring about assistance with back taxes through our Homeowner Assistance (HCRI) Program. Due to some medical issues and loss of employment, they had fallen behind on their property taxes. Thankfully, their health insurance covered most of the medical bills. They also were both in a better place, but just couldn’t seem to get caught up on them. To make matters worse, their mortgage holder was threatening to start foreclosure proceedings if they didn’t take care of their tax problem. 

Jen had checked with other agencies, but none were able to help, and she was beginning to feel desperate. Then someone suggested she contact Newcap. 

Before they actually met face-to-face, Jen sent Lisa their check stubs, monthly bills and bank statements. After putting those numbers into an initial budget for them, it was easy to see why they couldn’t catch up. They had already cut all the “wants” out of their budget, with all their income going to housing, food, transportation, insurance, and medical bills. They didn’t qualify for FoodShare because their income was too high. But, their grocery bill was minimal for a family of five because the only “vacations” they took involved hunting or fishing in order to fill their freezer with meat and fish for the year. Plus, they ran up some substantial balances on their credit cards while they were dealing with unemployment and were only able to pay the minimum balances on them. At this rate, they would be forever in debt!

Lisa set up a day and time for them to meet but asked them in the meantime to talk to their credit union about their mortgage. They were apprehensive because they were sure the interest rate would go up, as would their payments and they couldn’t afford a higher payment. Lisa urged them to reach out just the same because contrary to popular belief, no lending institution wants to end up foreclosing on a property. They aren’t in the real estate business and don’t want the responsibility of having to sell a house. 

About a week later, Jen was able to meet with Lisa. Lisa anticipated a disappointing encounter, as it was apparent from the numbers she had seen so far, that even if Newcap could help with the taxes, they could not afford their bills going forward and would be back in this situation sooner rather than later. 

Lisa was wrong though! Jen was very upbeat because their credit union was able to help! Not only would they refinance the mortgage for a slightly longer repayment term, rolling the taxes into the new balance. They were also able to get the funds to pay off their credit cards. The interest rate changed very little and their monthly payments actually went down a bit. They were able to use the money saved on the mortgage to have taxes and insurance payments directly deposited into a separate savings so there would always be enough funds to pay both when the bills arrived. This made them pleasantly surprised. 

Lisa used their appointments to provide them with links to other programs, such as Energy Assistance SafeLink cell phone and Wisconsin Focus on Energy to help them further reduce their budget. Jen was grateful for the advice and the support she felt during a very dark time. She knew that they didn’t need to meet given the circumstances, but just wanted to take the time to express her gratitude for the assistance. Turns out that financially, they didn’t need our financial help. But they were a success story just the same! 

About the Financial Capabilities Program

The Financial Capabilities Program assists participants with a wide array of financial counseling and coaching services to develop a comprehensive budget to understand their entire financial picture. This includes the cost to live month to month, to identify all income sources and debt obligations, and to develop a strategy to eliminate debts and achieve their goals. This program works in collaborate with Newcap program participants. 

Services under the Financial Capabilities Program: 

1. Budget Counseling
   • Do you need help to develop a budget? During a session, our Financial Coach assists clients with establishing a budget, evaluating debt, setting up financial goals, and developing an action plan. 
2. Mortgage & Tax Relief Counseling (HCRI)
   • Are you behind on your mortgage or real estate taxes? During this counseling service, our Financial Coach guides clients to get back on track if they have fallen behind with mortgage payments or taxes. Our trained counselor discusses available options for curing your delinquent home loan and create an action plan for successful homeownership. 

Click here to learn more about this program and other counseling services we provide: http://www.newcap.org/newcap_programs/financial-capabilities/

About the Homeowner Assistance (HCRI) Program

The Homeowner Assistance Program (HCRI – The Housing Cost Reduction Initiative) provides assistance to low-income individuals who are in danger of losing their home to foreclosure by helping them catch up on mortgage payments and past due property taxes. 

For those homeowners who do not meet the eligibility criteria, there is still assistance available in the form of budget counseling, organizing, and understanding the materials associated with foreclosure, and communicating with the mortgage company to attempt to work out any possible alternatives to foreclosure. 

Eligibility guidelines: Family must be at or below 80% of the County Median Income to qualify for foreclosure intervention; however, budget counseling services are available to all. The homeowner must be behind their mortgage payments, have the ability to pay their mortgage timely during and after assistance is received; as well as receive ongoing budgeting assistance. The home must pass a housing quality standards inspection. Use our eligibility calculator to find out if you may be eligible for this program. 

To learn more about this program, click here: http://www.newcap.org/newcap_programs/housing-cost-reduction-initiative-hcri-program/