NFMC Round 4 Eligible Applicant Briefing for NeighborWorks Organizations January 13, 2010

1. NFMC Round 4Eligible Applicant Briefing forNeighborWorks OrganizationsJanuary 13, 2010 Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

2. Table of Contents Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks Overview Legislation Program Design Timeline Documents GrantWorks

3. Overview • The Consolidated Appropriations Act of 2010 (Public Law 111-117) adds new funds to the existing National Foreclosure Mitigation Counseling (NFMC) Program. • Details: www.nw.org/nfmc Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

4. LegislationBeneficiaries Beneficiaries: “homes with mortgages in default or in danger of default will be provided such assistance … likely to prevent foreclosures and result in the long-term affordability of the mortgage retained pursuant to such activity or another positive outcome for the homeowner.” Positive outcome defined as homeownership preservation or, if not, least burdensome outcome. Examples: • Bring loan current – Home sale • Refinance existing mortgage – Short sale • Modify Mortgage – Deed in lieu • Forbearance agreement Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

5. LegislationAreas of Greatest Need “Provide mortgage foreclosure mitigation assistance primarily to states and areas with high rates of defaults and foreclosures …(and in areas) where there is a prevalence of mortgages that are risky and likely to fail,(or) mortgages that are likely to default and face foreclosure.” Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

6. LegislationAreas of Greatest Need Areas of Greatest Need analysis considers the following: Sub-prime Markets Prime Markets 1) # of delinquent loans 1) # of delinquent loans 2) % of loans delinquent 2) % of loans delinquent 3) % in foreclosure/REO 3) % in foreclosure/REO 4) % of loans subprime MSAs: if an MSA fell into the “worst” quintile in any of the these variables, they are considered an area of greatest need. Rural Areas: if 50% or more of the micropolitan areas in a state fall into the “worst” quintile in any of these variables, the state is one that we would consider having a foreclosure concern in rural areas. Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

7. LegislationEligible Applicants Who is Eligible?: - HUD-approved Housing Counseling Intermediaries approved by 8:00 PM EST on 2/9/10 - State Housing Finance Agencies - Chartered members of NeighborWorks network Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

8. LegislationEligible Applicants Who is Not Eligible?: • Individuals • local housing counseling agencies cannot apply directly (but may apply through HFA or Intermediary) • national and regional housing counseling intermediaries that are not HUD-approved • HFAs that do not have statutory authority to work statewide • Legal assistance organizations that are not HUD- approved housing counseling intermediaries • Any Applicant that in not in compliance with OMB A-133 audit requirements as of 2/9/10 • Applicants with unresolved compliance findings as of 2/9/10 may be ineligible, depending on the severity of the findings Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

9. LegislationEligible Applicants All Eligible Applicants must: 1. Demonstrate Experience Applicant must certify that each of its Sub-grantees or branches that will receive funding has: 1) worked successfully with financial institutions and with borrowers facing default, delinquency, and foreclosure; 2) documented counseling capacity, outreach capacity, past successful performance and positive outcomes with documented counseling plans (including post mortgage foreclosure mitigation counseling), loan workout agreements, and loan modification agreements; Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

10. LegislationEligible Applicants 3) achieved one of the following: • Provided foreclosure counseling services that included documented action plans to at least 50 people during the past year or 20 people during the past quarter OR • if > 75% of the applicant’s service area is rural and applicant provided foreclosure counseling services that included documented action plans to at least 25 people during the past year or 10 people during the past quarter OR • Applicant has provided foreclosure counseling services that included documented action plans to at least 12 people during the past year AND has at least one comprehensively trained and qualified foreclosure counselor on staff Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

11. LegislationEligible Applicants All Eligible Applicants must: • Adhere to the National Industry Foreclosure Counseling Standards • Demonstrate Ability to Provide a) reasonable analysis of borrower’s financial situation b) evaluation of current value of the property that is subject to the mortgage c) counseling regarding assumption of the mortgage or possible purchase of the mortgage by non- federal third party d) Counseling and advice of all likely restructuring and refinancing strategies, or approval of a work- out strategy by all interested parties Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

12. LegislationEligible Uses Training:up to $3 million to “build mortgage foreclosure and default mitigation counseling capacity of counseling intermediaries” • Scholarshipsfor counseling organizations to attend NeighborWorks Training Institutes • Regional Place Based Trainingsponsored and hosted by NeighborWorks America • Local Place Based Trainingsponsored by NeighborWorks America and hosted by HUD Intermediaries and or state Housing Finance Agencies • E-learning courses Foreclosure Basics, Understanding and Applying Foreclosure Intervention and Loss Mitigation Tools Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

13. LegislationEligible Uses Grant Funds • At least $59,400,000 for foreclosure counseling At least 51% to Areas of Greatest Need Performance Period: December 1, 2009 – December 31, 2010 Administrative Expenses • Up to 4% of total to: • administer grant program • study successful strategies and recommend efforts that can assist in the success of the foreclosure counseling • Develop secure data collection system • Third party quality control and compliance monitoring Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

14. LegislationMatch Match to be determined/waived by NRC based on affordability and economic conditions of an area • 20% match for the first $500,000; 10% thereafter. • Must be related to applicants’ foreclosure program • Need not be new resources • Can be cash or in-kind • Other federal funds may not be counted, nor may funds used to match NFMC Round 1 or 2 funding • Match window 6/30/09 to 12/31/2010 • The match requirement may be waived for counseling delivered in defined geographic areas suffering from high poverty and high unemployment Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

15. Program DesignRequest Amount Two categories of funding: 1) Counseling 2) Program-Related Support Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

16. Program DesignRequest Amount “Level One” Counseling ($150) Intake including basic demographic information, lender and loan information, and reason for delinquency. Authorization that allows organization to (a.) submit client-level information to the data collection system for this grant, (b.) open files to be reviewed for program monitoring, and (c.) conduct follow-up with client related to program evaluation. Budget based on client’s oral representation of their expenses, debts, and available sources of income. Written Action Plan for follow up activities to be taken by the client and review this Action Plan with the client. Making Home Affordable Eligibility Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

17. Program DesignRequest Amount “Level Two” Counseling ($300): Engage in budget verification If not already on file, organization shall collect authorization form Steps to obtain a solution outlined in the written Action Plan are taken and documented using counseling notes that indicate date counseling occurred Close-out documentation is completed. Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

18. Program DesignRequest Amount NWOs may contract with other entities to provide foreclosure counseling provided: • Arrangements are contractual • Contractor must be non-profit organization • NWO can contract out no more than 50% of its awarded Counseling units • NWO signs standard rep/warranty as supplement to NFMC Grant Agreement Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

19. Program DesignRequest Amount Local organizations may apply on their own and/or through multiple intermediaries/HFA • Must segment counseling goals by funding source and supply disclosure letter to all entities through which it is applying. Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

20. Program DesignRequest Amount Program-Related Support: Applicants will receive a flat 20 percent of their counseling award for Program-Related Support • Establishing a triage system • Outreach to delinquent borrowers • Group orientation and education • Infrastructure development and communication • Improving capacity for tracking and reporting data • Costs related to hiring, orienting, and training new counseling staff • Purchasing or leasing equipment and software for new counselors • Collecting data and preparing quarterly reports and draw requests • Outreach and communication on preventing rescue or loan modification scams Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

21. Program DesignAward Decisions • No organization may request more than 15% of the total amount available in counseling funds. Total request cap is $8.91 million. (The counseling award request cap is $7,016,000). Further award limits may be established during the grant review and award process • No organization can request less than $50,000 (the counseling award floor is $41,670) • Review Teams will score applications • Award decisions will be based upon on a number of considerations, including (without limitation) (1) past performance in NFMC and spend down of current NFMC funds; (2) the recommendations and scores of grant reviewers with particular attention to the Applicant’s demonstrated experience and capacity to deliver counseling services and/or manage multiple Sub-grantees and Branches; (3) the reasonableness of Applicant’s counseling goals; (4) geographic diversity and coverage in areas of greatest need; and (5) total demand for funding from all Applicants. • May draw on information outside of what is included in app Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

22. Program DesignDraw Schedule 1st Draw: 35% of counseling award + 35% of operationaloversight (OO) + 70% of program related support (PRS) after receipt of signed grant agreement and start-up documentation 2nd Draw: After 25% of total production goal is demonstrated (in dollars, not units), second draw is initiated, which consists of additional 30% of counseling award + 30% of OO + 15% of PRS 3rd Draw: After 60% of total production goal is demonstrated (in dollars, not units), third draw is initiated, which consists of additional 30% of counseling award + 30% of OO + remaining15% of PRS Final Draws: After 100% of total production is demonstrated (in dollars, not units), half of remaining balance is awarded after last quarterly report and half is disbursed after completion of evaluation requirements Note: No Grantee will receive multiple draws at one time. Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

23. Program DesignDraw Schedule Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

24. Program DesignReporting • Production Reports trigger draws • Quarterly Programmatic Reports • Ongoing Evaluation THIRD PARTY- data collection - quality control and compliance - evaluation Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

25. Program DesignNotables Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks Round 4 Legislation Very similar to Round 1 Handling of Duplicate Clients 5% waiver of non-self duplicates Making Home Affordable Can use up to 30% of counseling award to counsel at Levels 4a and 4b Levels of Counseling No Level 3 designation Level 1 must include MHA screening No Exclusivity Clause

26. Program DesignNotables Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks Streamlined Grant Application • Grantees that have no uncured compliance findings as of 1/12/2009 AND one of the following is true: • Round 2 Grantees that are > 75% finished with Round 2 (in dollars, not units) by 1/12/2009 OR • Round 3 Grantees that don’t have Round 2 funds and are > 25% finished with Round 3 (in dollars, not units) by 1/12/2009 Full Grant Application • All first time applicants • Applicants that were only in Round 1 • All previous Grantees that do not meet criteria above

27. Timeline(subject to change) Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

28. Documents Posted now: • Legislation • Application Questions • PPT Presentations from today • Data collection forms & sample documents (disclosure letters, etc.) • Guidance (in-kind match, etc.) Posted on or before January 19 • Areas of Greatest Need • Funding Announcement • Application Guides • Recordings of these sessions • Low income and minority zip codes Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks

29. GrantWorks Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks How to Access and Navigate GrantWorks to complete application

30. Questions? Overview Legislation Beneficiaries Areas of Need Eligible Applicants Eligible Uses Match Program Design Request Amount Award Decisions Draws &Reporting Notables Timeline Documents GrantWorks