The Home Affordable Modification Program, Neighborhood Stabilization Program, Circuit Court of Cook County Mortgage Foreclosure Mediation Program, and Hardest Hit Fund: all of these programs, designed to attack the foreclosure crises in different ways, have one thing in common—they depend heavily on housing counselors for their success. Even as there continues to be a pressing need for foreclosure prevention services, funding for housing counseling is undergoing major cuts. The HUD Housing Counseling Assistance Program was zeroed out in part of 2011 and in the 2012 appropriations bill proposed by the House of Representatives.  A fraction of that funding has been restored, but it is still less than existing funding levels that are already insufficient to meet the need for counseling services. Our research showed that there are significant gaps in housing counseling resources in areas that have seen recent increases in foreclosure activity, particularly in South Cook County.

The Occupy Wall Street movement and related protests across the country have brought attention to growing wealth inequalities and the need for policy reforms to create a more just financial system and help our communities recover. Many of our friends and neighbors are feeling the impact of the economic crisis through layoffs, foreclosures, bankruptcies, underwater mortgages, neighborhood blight and more. Some are using the OWS movement and the related We are the 99 Percent blog to tell their stories and ask for change.

The foreclosure crisis has posed unprecedented challenges to all levels of government. Cities, counties, and states have been laboratories for creative foreclosure prevention programs, trying out different models to see what works and what doesn’t. Communities can more effectively address the foreclosure crisis when we learn from the experience of others. In that spirit, Woodstock Institute met with Rachel Blake of Philadelphia’s Regional Housing Legal Services this week to see how Philadelphia is approaching its foreclosure challenges.

Solutions to the foreclosure crisis have been notoriously difficult to pin down, in part because the forces that drive foreclosure are diverse and changing. Some borrowers are under duress because their monthly payments have grown substantially. Others owe more on their homes than they are worth or have lost their incomes due to unemployment. Each situation requires different types of interventions to effectively prevent foreclosure whenever possible. The majority of government interventions thus far have focused on helping homeowners whose payments have become unaffordable. The Illinois Housing Development Authority (IHDA) recently launched a $445.6 million program that’s designed to help the third group—people struggling with their mortgage payments due to a significant loss of income.

Treasury has issued reports on the Home Affordable Modification Program for over a year and a half. While we’ve been looking at changes in the program month-to-month in our regular HAMP analyses, we’re going to look at the yearly changes now that we have more than a year of data to examine and get a broader view of how the program has changed over time.

Chicago region foreclosure cases are taking longer to complete the foreclosure process, resulting in a dramatic drop in foreclosure completions from the first half of 2010 to the first half of 2011, new data from Woodstock Institute show. As fewer cases complete the foreclosure process each quarter, it is likely that the number of homes tied up in the foreclosure process is growing.

As you may know, Capital One recently applied to regulators to acquire ING Direct. The deal would create the fifth-largest bank in the country and raises substantial concerns about how the deal would impact communities.

With home values continuing a steep decline, little change in the unemployment rate, and 26 percent of Illinoisans owing more than their home is worth, little has been done to buoy confidence that an economic recovery is at hand. A settlement of the investigations surrounding last year’s robo-signing scandal that, among other things, achieves widespread principal reduction commitments from major servicers, could change that–but only if done carefully.

Today, the Senate Committee on Banking, Housing and Urban Affairs will hold a confirmation hearing for Richard Cordray to be Director of the Consumer Financial Protection Bureau (CFPB). This hearing, which was previously scheduled to take place in August but was postponed following an early Senate recess that came after the debt ceiling vote, is vital to the future of the CFPB.  Unfortunately, all indications are that the hearing will be fraught with disagreement and, in all likelihood, will not result in confirmation.

Next week will be an important one for every Chicago area consumer who uses financial services, from the payday loan store on the corner to Wall Street’s biggest banks. The Senate Banking Committee will hold a hearing September 6th to consider the confirmation of Richard Cordray, President Obama’s nominee as Director of the Consumer Financial Protection Bureau (CFPB). It is crucial that the Senate quickly confirm Cordray, a former Attorney General of Ohio who is well-qualified in consumer issues. However, forty-four Senators, including Illinois Senator Mark Kirk, have vowed to block any nominee until the CFPB is significantly weakened. The longer the process drags on, the longer the CFPB will lack the authority to regulate some financial service providers which have high potential for abuse—such as payday lenders, independent mortgage lenders that made the majority of predatory subprime loans during the housing bubble, and debt settlement companies.