DaytonDailyNews.com

With foreclosures increasing by more than 10 percent in the county, local nonprofit agencies that offer assistance say their workload has skyrocketed.

In 2008, nearly 3,000 properties were foreclosed in Butler County and 1,306 were foreclosed in Warren County, according to a recent report by Policy Matters.

Officials said publicity about how to seek help from nonprofit agencies, as well as the spike in homes losses, has left local offices scrambling. At times they've been unable to fulfill requests for assistance

Some of those requests have been like the Phelps family of Madison Twp., which sought assistance from "anyone who would listen" but still lost their home at foreclosure auction.

What began as a disagreement on how Keith and Sharon Phelps' mortgage payments were being applied to their escrow account ballooned into a full battle with the bank. Although their contract included a clause in which the couple could opt to pay their insurance and taxes themselves, their lender refused to accept payments that excluded this cost.

Eventually the lender stopped accepting payments and a mere month after that, it sent a notice of foreclosure.

By this point, Keith had lost his job and with Sharon on disability, they were left without an income. Having been turned away from nonprofit agencies before, and lacking the equity to hire a lawyer, they turned to United Homesavers, an agency that guaranteed a mortgage workout. But after months, all they received for their $1,300 was a foreclosure auction notice and information that the Homesavers had been shut down due to fraudulent practices.

"Everyone said we had a case, but we couldn't find anyone to take it," Keith said. "I've been paying for this house for nine years and I put $36,000 down — all to have it just taken away from me."

The couple said they wished they had acted earlier, but more than anything, they wished they hadn't put their faith in agencies too busy to take their case.

Legal Aid

For the period of January through March, Legal Aid, which offers attorney services for low to moderate-income families, reported its foreclosure assistance calls increased from 21 in 2008 to 61 so far this year. While the office offers legal services on a variety of matters, within the past year its foreclosure program has become No. 1 in the practice, said Carrie Dettmer Slye, an attorney with Legal Aid.

Because the practice supplements its staff with volunteer attorneys, "pretty much (we) approach the capacity of our ability to help clients each month," she said.

Assistance is given on a case-by-case basis. Most of what Legal Aid does is offer advice. Other times it can work with the lenders' attorneys or the lender itself on a loan modification. It can get foreclosure judgments set aside before an actual auction.

Just this year, the agency has begun offering pre-foreclosure assistance, where it can offer legal advice on a loan and connect residents with counselors before a home is foreclosed. But how cases are assigned is a complex process, and not every case can be picked up given the demand, Dettmer Slye said.

"There are just some people we just can't serve," she said.

Neighborhood Housing Services

A self-described realist, Don Gardner, manager of Neighborhood Housing Services, said he knew foreclosures would get worse before they got better.

"More people are going to get assistance, but not everyone is going to be saved," he said.

The need has translated to more people coming to his office for help. For the period of January through March 2008, 22 people sought assistance compared to 90 for the same period this year.

And while NHS isn't turning residents away, some cases are beyond its abilities.

"Once the home is in foreclosure, there is not as much we can do," he said. "And if there is no income (because the resident is unemployed), then there is nothing you can work out with the lender. You have to have something to work with."

LifeSpan

As an agency that already was offering budget counseling, LifeSpan said its expansion into foreclosure assistance has been dramatic, according to Cheryl Burns, director of family life services.

While LifeSpan only served six people from January through March 2008, that number has jumped to 47 clients so far this year.

Burns said the agency has hired a counselor and is reserving some of its funding to hire another.

"We've had a huge increase, but we're taking them. We're trying not to schedule more than two weeks out," she said.

LifeSpan has certified counselors trained to help residents seek mortgage workout solutions with lenders and also offers debt-management classes.

"We've found that once clients go through the debt management, they don't experience some of these pitfalls," Burns said.

Services also are available online.

Best option

Despite the deluge on nonprofit agencies, representatives from the U.S. Department of Housing and Urban Development said those are the most cost-effective help.

As part of President Obama's loan modification program, HUD launched a Web site, www.MakingHomeAffordable.gov, to help residents learn how to get assistance in modifying loans.

Nonprofit assistance programs

Middletown: (513) 420-9193

Hamilton: (513) 737-9301

Legal Aid: (513) 241-9400

LifeSpan: (513) 867-7545

Contact this reporter at (513) 705-2843 or jheffner@coxohio.com.