Homeownership Preservation Foundation Survey Reveals Significant Optimism Among Distressed Homeowners who Receive Housing Counseling
71% of Callers Expect to Resolve Personal Finance Crisis and Remain in their Home
WASHINGTON, D.C., JULY 18, 2011 –The Homeownership Preservation Foundation (HPF), an independent national nonprofit dedicated to helping distressed homeowners navigate financial challenges and avoid mortgage foreclosure through its Homeowner’s HOPE™ Hotline at 888-995-HOPE™, today released survey findings underscoring a surprising level of financial optimism among homebuyers who call HPF for foreclosure prevention counseling.
Despite a majority (52%) of survey respondents reporting a significant decline in their household income compared to a year ago and 88% reporting anxiety around their ability to make payments on their debt, nearly three-quarters (71%) of survey respondents said they are confident that they will be in their home 12 months out. Nearly three-fifths of respondents (58%) said that they expect their personal financial situation to get better over the next year. An expected reduction in mortgage payments (41%), a new job (19%), or an increase in wages (12%) was the most common reason cited for the anticipated improvement to their personal finances.
Additionally, 60% say they consider buying a home to be a safe investment, which is particularly compelling given that the majority of respondents (53%) say their mortgage is underwater (meaning that the balance due on the loan exceeds the home’s total value at least by 5%) and an equal number (54%) said that the value of their home has depreciated since its purchase (by at least 20% for two-fifths [40%] of survey participants). Only 22% of respondents said defaulting on a loan is acceptable when facing financial distress, with less than half that number (10%) saying it is acceptable to do so when one is underwater on a mortgage.
“The results of HPF’s Homeowner Sentiment Survey underscore an undeniable sense of optimism and financial confidence among individuals who call us for foreclosure prevention counseling,” said Colleen Hernandez, HPF’s CEO. “Homeownership clearly remains front and center in the American Dream, and we applaud the resilience and determination of distressed homeowners to fend off foreclosure, which many of them are able to do after calling our counselors for reliable information on available assistance programs and for help working with their lenders.”
Other key findings:
- An overwhelming majority (88%) of surveyed HOPE Hotline callers support mortgage modification programs. However, while five out of six said that they applied for one within the last three years, just 17% said that they have seen steady progress with their application.
- Not all respondents were optimistic about their financial future. Of the 14% of respondents who felt that their personal financial situation will worsen in the next year, declining wages (25%), worsening economic conditions (17%), increase in mortgage payment (15%), or negative equity on their home (9%) were cited as the factor most contributing to their pessimism.
- While a full three-quarters (76%) of respondents say their overall experience with homeownership has been a positive one, less than one-third (31%) said they would buy another home if they moved (as opposed to 37% who said they would rent and 32% who said they did not know what they would do). Half (52%) of those would-be-buyers stating that their next home would be less expensive than their current one.
- One-quarter (26%) of respondents said that having emergency savings is the most important precaution one can take before buying a home. Only 4% of respondents perceived their savings as sufficient.
The HPF Homeowner Sentiment Survey provides insight into the financial and economic attitudes and outlook of American homeowners facing foreclosure and other monetary challenges. Today’s announced results are derived from a study managed by Penn Schoen Berland, a leading market research and consulting firm, which conducted 1,160 online interviews with recent callers to the Homeowner’s HOPE Hotline.
About the Homeownership Preservation Foundation
The Homeownership Preservation Foundation (HPF) is an independent national nonprofit dedicated to helping distressed homeowners navigate financial challenges and avoid mortgage foreclosure. HPF guides consumers onto the path of sustainable homeownership and develops innovative solutions to preserve and expand homeownership. Through its Homeowner’s HOPE™ Hotline, 888-995-HOPE™, HPF provides comprehensive financial education and confidential foreclosure prevention counseling for FREE, 24 hours a day, 7 days a week, 365 days a year, in over 170 languages. Since 2007, HPF has served more than five million distressed homeowners, an average of 5,500 each weekday, who depend upon HPF as a trusted, neutral source of information and assistance. For more information about the Homeownership Preservation Foundation or the Homeowner’s HOPE™ Hotline, please visit www.995hope.org
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