Not For Profit » Economy

How to Reinvest Profits with a Non-Profit

admin — Tue, 26 Apr 2011 23:48:39 +0000

How to Reinvest Profits with a Non-Profit

Around election time, politicians like to talk-the-talk about the importance of small businesses to economic vitality. Often overlooked in the rhetoric is the contribution of new non-profit organizations to regional economies.
Non-profits have the same ability to attract outside capital through donations and grant awards, increase employment, and produce a ripple effect of economic activity to other local businesses And of course, non-profits provide extra value in terms of socially-enriching benefits to communities in terms of education, healthcare, poverty relief and other services.
But, here’s the surprising gotcha for socially-motivated startup entrepreneurs who want to make a difference in their communities or the larger world without paying income taxes on service profits. Just because they want to operate a non-profit organization, doesn�t mean they will be able to as quickly as they would like, if at all. The decision rests entirely with the Internal Revenue Service. Read More

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Freddie Mac, Non-Profit Groups Team Up to Help Discouraged Borrowers Pursue Loan Modifications

admin — Tue, 16 Feb 2010 20:01:52 +0000

Freddie Mac, Non-Profit Groups Team Up to Help Discouraged Borrowers Pursue Loan Modifications

Freddie Mac and 13 national and local non-profit organizations today announced a pilot effort to convince discouraged delinquent borrowers to pursue mortgage workouts that can save their homes and steer clear of foreclosure.

Freddie Mac’s new Borrower Help Centersin Chicago, Phoenix, San Bernardino and Washington, DC are designed to provide free, confidential one-on-one “holistic” mortgage counseling to delinquent Freddie Mac borrowers. The company is also launching a separate Borrower Help Network offering similar counseling over the phone to targeted Freddie Mac borrowers across the nation.

Both efforts rely on non-profit organizations with strong reputations to contact and work with Freddie Mac borrowers who may be eligible for a modification but never called their lender or became frustrated or uncertain of the process and gave up trying.

“We know that fear and frustration are keeping thousands of borrowers from getting the help they’re eligible to receive,” says Ed Haldeman, Chief Executive Officer, Freddie Mac. “So we’re going to address the problem head-on by working together with nonprofit partners. These organizations are trusted and valued sources in their communities, and we believe they can make the difference in keeping families in their homes and out of foreclosure.”

Holistic financial counseling goes beyond mortgage issues and also includes an assessment of borrower debt and credit issues that could affect a borrower’s ability to stay current on a mortgage after a modification. Borrowers in some stage of foreclosure are 60 percent more likely to keep their homes than other borrowers, according to a recent study from NeighborWorks America.

Groups participating in the Borrower Help Center and Borrower Help Network include the National Urban League, National Council of La Raza (NCLR), HomeFree-USA, local Neighborhood Housing Services in Chicago, Phoenix, and Ontario, California, and other local community organizations. “NCLR’s partnership with Freddie Mac on this program means that distressed minority homeowners can access effective, personalized housing counseling from trusted community organizations. This effort will strengthen our ability to replicate best practices and succeed in helping more Latino families stay in their homes,” said Janet Murguia, President and CEO of NCLR, the largest national Hispanic civil rights and advocacy organization in the United States.

“The National Urban League looks forward to working with Freddie Mac on this important project as we collectively seek to test enhancements to the home retention continuum that prioritize client counseling and best utilize trusted community groups in order to help more minority borrowers avoid unnecessary foreclosure,” states Marc H. Morial, President & CEO of the National Urban League. “The Borrower Help Network is a critical response to the housing crisis and its design is clearly linked to comprehensive and sustainable neighborhood stabilization, which remains the ultimate objective.”

In 2009 Freddie Mac helped nearly 250,000 borrowers avoid foreclosure through loan modifications, forbearance, repayment plans and other workouts, including modifications under Making Home Affordable. Freddie Mac accounts for nine percent of all seriously delinquent mortgages, but finances almost 23 percent of America’s residential mortgages
.

Neighborhood Borrower Help Centers Open in Four Key Markets

The free Borrower Help Centers in Chicago, Phoenix, Washington, DC and California’s Inland Empire have already started contacting delinquent borrowers identified by Freddie Mac for appointments. In addition, delinquent borrowers who know Freddie Mac owns their mortgage can also schedule free appointments by contacting the Borrower Help Center in their community. (See attachment for locations and contact information.)

Counselors at each Borrower Help Center are trained to review Freddie Mac and Making Home Affordable workout requirements with their clients. Counselors will also provide one-on-one guidance to help borrowers apply for modifications, supply missing information or documents needed to move an application forward, and work with Home Retention Services, a wholly owned subsidiary of Stewart Lender Services, Inc., to help borrowers effectively connect with their servicers.

At the same time, the counselors will work with the borrowers on other outstanding debt and credit issues, such as credit card debts or auto loans, that may also be causing financial distress.

Borrower Help Centers in Chicago are being staffed by Neighborhood Housing Services of Chicago and the Latin United Community Housing Association (LUCHA), and in Phoenix by Neighborhood Housing Services of Phoenix and Chicanos Por La Causa. Neighborhood Partnership Housing Services in Ontario, CA and Home Free USA in Hyattsville, MD, a Washington, DC suburb have also opened Borrower Help Centers.

National Borrower Outreach Network Launched

In a parallel effort to reach distressed borrowers located outside of the initial target areas, Freddie Mac is launching a separate Borrower Help Network consisting of eight national and local non-profit organizations.

Together they are launching a national phone campaign to make contact with delinquent Freddie Mac borrowers who have stopped responding to their lenders. Counselors will provide free holistic counseling, and help borrowers explore and understand their mortgage modification options.

The Borrower Help Network also will work with Home Retention Services to connect borrowers with their servicers for a mortgage modification or other foreclosure alternative.

Participating organizations include the National Urban League and its chapters in Broward County, FL and Hampton Roads, VA, NCLR and NCLR Affiliate Network members — Southwest Housing Solutions in Detroit and New Economics for Women in Los Angeles. The Metroplex Economic Development Corporation in Dallas, Korean Churches for Community Development and Boat People SOS, which works with Vietnamese Americans through 15 branches across the country, are also participating in Freddie Mac’s Borrower Help Network. (For more information, visit freddiemac.com/avoidforeclosure)

Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation’s residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters.

FREDDIE MAC BORROWER HELP CENTER LOCATIONS

Chicago, IL
Latin United Community Housing Association (LUCHA)
1152 N Christiana Avenue
Chicago, IL 60651
773- 489-8484

Chicago Neighborhood Housing Services
1279 N. Milwaukee Ave., 5th Floor
Chicago, IL 60642
773-329-4181-Spanish
773-329-4185- English

California – Inland Empire
Neighborhood Partnership Housing Services (NPHS)
320 W. G Street Suite 103
Ontario, CA 91762
800-761-6747

Phoenix, AZ
Phoenix NHS
1405 East McDowell Road, Suite 100
Phoenix, AZ 85006
602-258-1659

Chicanos por la Causa
1112 East Washington Suite 102
Phoenix, AZ 85034-4043
602-253-0838

Washington DC
HomeFree-USA
3401A East West Highway
Hyattsville, MD 20782
301-891-4606 (English)
301-891-4607 (Spanish).

Source: Freddie Mac

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Not For profit Fundraising Downturn

admin — Mon, 27 Oct 2008 11:20:14 +0000

Not For profit Fundraising Downturn

Not for profit organizations both large and small from wall street to main street are feeling the impact on donations and fundraising as a result of the national current economic climate.The financial pinch will only deepen in the coming months given the potential of a Global recession now taking shape.

The potential impact is just now taking shape, because 2009 grants from many philanthropic foundations are still being set and the end-of-year holiday giving season is opening. Although it’s difficult to draw broad conclusions from reports by individual charities, many non-profits say they are feeling an economic pinch.
“This is the worst fundraising environment I’ve ever worked in,” says Jeffrey Towers, chief development officer for the American Red Cross, which won promises of $100 million from Congress this month after 2008′s hurricanes, tornadoes and floods depleted the group’s disaster-relief reserves.

Not for profit sector and economic down turn

admin — Tue, 21 Oct 2008 17:31:40 +0000

Not for profit sector and economic down turn

The current economic downturn is a bloated up financial crisis caused by the erroneous banking system. The banks refuse to take measures beyond the so-called �light touch regulation�. As their regulatory authority is being constantly challenged, they have begun to aggressively embrace newer methods of funding the failed mortgage lending. These complex financial instruments have been the core reason of the current economic downturn. As the banks all over the world are announcing their losses and the housing bubbles in America, Ireland and Spain are bursting, there has been a simultaneous escalation in the oil prices, more so following the impact of the September 11, attacks. With collapse of the Lehman Brothers, the crunch has manifested itself deeper and wider. The Federal authorities therefore are forced to raise the tax levels in order to meet the increasing costs.
Diversification of the donor base is one of the prime options for the not-for-profit sector. This will enhance their opportunities to leverage their present and future donors. When an economy slows down it results in a natural increase in the number of people who are in need of assistance. They require help for sustenance. The impact is largest on the not-for-profit sector since they are widely apprehended as provider of welfare services.
As the individual donations lessen, the endowments of the foundations that belong to the corporate sector also feel the impact as they cut their profit margins and reduce their degree of corporate social investment. Non-profit sectors who have managed to build a reserve might get through this period but not for long. They need to think of long-term sustainability. The secret lies in maintaining open communication lines and ensuring that those relationships that had helped them to raise funds are assured their due importance and trust.
It has been seen that even during the recessionary periods, the core supporters belonging to the typical Christian donor types do not abruptly pull back during this bumpy phase. They realize the financial challenges faced by the organization. As the organization effectively demonstrates that these donations are indeed making huge difference to the lives of the people, it helps in sealing their fundraising worries.

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