BOSTON, Jan. 21, 2020 /PRNewswire/ -- BlueHub SUN, a national nonprofit foreclosure prevention program, has stabilized more than 1,100 families by helping them avoid the impacts of foreclosure since 2009. Since its inception a decade ago, the SUN (Stabilizing Urban Neighborhoods) Initiative from BlueHub Capital has allowed individuals facing foreclosure and eviction in seven states to remain in their homes.
The program is the first and only of its kind, offering financing to qualified borrowers who are committed to maintaining a regular payment schedule. The fund buys houses or mortgages in foreclosure and sells or refinances them back to the original homeowners or tenants with mortgages they can afford.
BlueHub SUN is a trusted partner with a proven track record since launching in 2009, at the height of the nation's foreclosure crisis. Homeowners' principal reduction, on average, has ranged between 28 percent and 38 percent, with more than $180 million in total mortgage financing provided. SUN operates in Connecticut, Illinois, Maryland, Massachusetts, New Jersey, Pennsylvania, and Rhode Island.
Applicants to the program are facing hardships, leading them into foreclosure, such as Vietnam veteran, Randy B. of Spencer, Massachusetts. Randy came to SUN after bills piled up when his wife was diagnosed with a rare form of Parkinson's disease.
"I want to do business with people I can talk to—not a computer. And I want to deal with people who tell me the truth," Randy said. "SUN gave me that sense of security, that that's what they're there for: to give you a hand, to get you going, and you get it done."
BlueHub Capital Chief Executive Officer, Elyse Cherry, has served in this role since 1997. Cherry helped found BlueHub in 1984 and was appointed CEO in 1997, serving an integral role in establishing the SUN program in 2009.
"All of us at BlueHub are extremely proud of how far this program has come along over the past decade," says Cherry. "We are thrilled to see the number of households the fund has been able to impact and look forward to the continued growth in the next decade."
Cherry credits the program's success in part to a financial concept called shared appreciation — sometimes called shared equity — agreements that allow homeowners to access some equity in their homes in exchange for giving the housing lender, in this case BlueHub's SUN Initiative, a contingent financial interest in the property. The lender has no occupancy rights but participates in the increase – or decrease – in the value of the property.
"We founded SUN because we were concerned about the destabilizing effects of foreclosure in neighborhoods, particularly low-income neighborhoods," said Cherry. "Studies have shown that in middle-income neighborhoods each home in foreclosure reduced value in the neighboring homes by 0.9 percent. But in low-income areas, the reduction was greater at 1.5 percent. So, by reducing the number of foreclosed homes, we helped stabilize values in the neighborhoods – hence our name Stabilizing Urban Neighborhoods."
In most cases, SUN mortgages equal roughly 100 percent of the homes' value, but it does not charge mortgage insurance. As a nonprofit, the SUN Initiative reinvests its proceeds into helping other homeowners and to helping to build healthy communities where low-income people live and work.
"We have reduced the outstanding principal owed by our borrowers by about $68 million," Cherry said. "We've reduced monthly payments by about $42 million, and we've created roughly $100 million in equity for folks who were in the final stages of foreclosure or had already lost titles to their homes, had no equity, and were close to eviction."
SOURCE BlueHub SUN