The purpose of the default clinic is to streamline the default counselor's time and assist more homeowners currently experiencing default issues. The default clinic model is estimated to save over 27 counseling hours by initially counseling 20 people in one session vs. meeting one-on-one. The one-on-one session will still take place but only after the triage session.

Setting Up a Default Clinic

  • Be consistent with the day, time, and location, such as the first and third Tuesday of each month at 6 p.m. or the second Saturday of each month.
  • One-third of your participants will not show for the first clinic they register for. The same fear that has kept them from contacting their lender is also keeping them from attending the clinic. Having a regular schedule will ensure that they attend the next clinic.

During the Clinic

  • Review the file documentation and the purpose for the information collected.
  • Review the foreclosure process and what to expect next.
  • Explain what will be expected from the client:
    1. Agreeing to spend time on the HOPE line to review budget,
    2. Returning counselor's calls in a reasonable period, and
    3. Completing all paperwork and follow through with requested documentation.
  • Complete the household budget. Encourage clients to identify absolute needs versus wants in their household expenses. It may be necessary to cut expenses such as cable TV, multiple phone bills, beauty expenses, and possibly even charitable contributions to produce a positive budget.
  • Be sure that each client leaves the clinic with a copy of the budget to review with the HOPE counselor the next day.

The Triage Session

  • The purpose of the triage session is to quickly assess the client's situation and propose a possible resolution.
  • The triage counselor may not be the counselor who will ultimately be working with the client. Therefore, it is important the assigned counselor be able to pick up the folder, read the triage notes, and immediately be able to get to work on a resolution.
  • The counselor should spend no more than FIVE minutes with each client at the clinic.
  • The counselor will QUICKLY assess the default situation.
  • Each client should be given the name of the counselor they will be working with or at least a generic business card to follow up within the next few days.
  • The counselor should complete the note page in the front of the file with the following information:
    • Number of months delinquent.
    • Amount of delinquent taxes (if any).
    • Amount of other debt and status (current or delinquent).
    • Reason for default (job loss, temporary unemployment, illness, other).
    • Mortgage loan balance.
    • Amount of cash available to pay toward delinquent amount or restructure.
    • Positive/negative equity in home (estimated).
    • Suggested resolution(s) for the situation.

The Day After the Clinic

Foreclosure coordinator processes all clinic files the next day with the following:

  • Logging files into database and spreadsheets,
  • Connecting clients to the HOPE line via third-party calls, and
  • Faxing all authorization forms to appropriate parties, i.e., lenders, attorneys, Realtors, and investors.

Client Case Assigned

  • The case is then assigned to a counselor.
  • A follow-up letter is sent to the client with the counselor's contact information, including name, phone number, and e-mail address.

Counselor's Work Begins

  • Default counselor now begins the hard work.
  • The initial triage and administrative work is already complete. The counselor reads the triage notes, becomes familiar with the file, and immediately begins working with the lender on a resolution.
  • When a default resolution is final, the foreclosure coordinator updates the HOPE data worksheet and posts the information into the Credit Counseling Resource Center (CCRC) system.