ReStart Your Mortgage
National Community Capital purchases mortgages to reduce foreclosures and stabilize neighborhoods.
ReStart is an innovative home preservation initiative designed to prevent foreclosures and stabilize communities. The program was created by New Jersey Community Capital (NJCC), through its subsidiary National Community Capital (NCC). ReStart strives to keep families in their homes by purchasing pools of distressed mortgages at a deep discount and reducing the principal on their mortgages to an amount they can afford. ReStart is unique in that its acquisition strategy is coupled with NCC's social mission: NCC is committed to ensuring positive outcomes for these homeowners by providing them with high-touch financial counseling and support services, as well as opportunities to receive transitional assistance to new quality housing, if needed.
In September 2012, a winning bid was submitted to purchase hundreds of delinquent Federal Housing Administration loans at a discount through a federal program. This program requires loan purchasers like NCC to halt foreclosures for six months while they work to modify loans. NCC was the only nonprofit organization to successfully bid on targeted pools of mortgages in two metropolitan areas—Newark, New Jersey and Tampa, Florida. NCC is working to replicate this bulk-purchase model. As a purchaser of loan pools, NCC cannot purchase individual mortgages. If your mortgage is not in a pool of loans we have purchased and you would like assistance in trying to get back on track, please contact your mortgage servicer or a HUD approved housing counseling agency.
The ReStart Program offers borrowers the opportunity for a permanently modified, affordable, fixed-rate mortgage at a reduced principal balance that is aligned with the home's current market value. This approach will allow for a homeowner's monthly mortgage payments to fall to 35% or less of their adjusted gross monthly income. At the same time, NCC will contract with several community-based counseling organizations to assist participating families in developing customized budgets and payment plans that will help them achieve positive housing and financial outcomes. Services will include intensive financial education, debt management planning, and strategies for reducing monthly homeownership costs. This approach addresses issues related to both mortgage and consumer debt, two of the greatest hurdles that these families will face in building a stable financial foundation. As ReStart begins working with each family, it will identify which homeowners may be able to retain their homes under a restructured mortgage. Reduced mortgage payments will begin when the borrower enters a trial modification period. After successful completion of this temporary arrangement, the homeowner's mortgage will be permanently modified to the affordable rate.
Despite intensive financial guidance, not all program participants will be able to continue making mortgage payments. Through ReStart, these families will receive the support they need to effectively transition to a stable housing situation, such as a lease-to-purchase arrangement in their current home or affordable rental housing. When a family cannot feasibly maintain occupancy of their current home, ReStart will make sure the property is returned to the market as quality affordable housing. In cases in which the properties are already vacant, ReStart will quickly work to affordably provide these homes to qualified homebuyers or renters.
While the ReStart Program seeks to achieve positive outcomes and a stronger long-term financial situation for all participating families, the impacts of ReStart will also be felt at the community level. ReStart has the potential to propel the stabilization of at-risk neighborhoods by reducing their foreclosure rates and reoccupying their vacant properties as quickly as possible, which will elicit many positive neighborhood outcomes proven to be associated with a stabilizing housing market.
The implementation of ReStart serves as a national model for revitalizing distressed communities and jumpstarting housing markets all across the United States. This unique, socially-motivated initiative will reduce principal balances for families in need The program is designed to be self-sustaining due to its ability to cover upfront costs and repay investors through the future sale of reperforming mortgage loans.
Homeowners who begin to make reoccurring, on-time payments on their restructured mortgages will provide evidence for the effectiveness of early foreclosure interventions. This strategy can help families before they are foreclosed out of their homes and their properties become vacant and abandoned. It also will demonstrate the value of tying financial education to principal reduction as a means of strengthening the capabilities of families to remain homeowners.
National Community Capital works to reduce foreclosures and stabilize neighborhoods across the country. NCC achieves this goal by purchasing pools of distressed mortgages in strategic locations, aiming to reduce the outstanding principal balance to an affordable level. NCC's strategies can offer qualifying homeowners greater options in achieving stable housing opportunities.