Action Alert: Housing Counseling Funds Part of Federal Clawback

Update: The NC Housing Coalition has joined nine other housing nonprofits in a federal lawsuit against the Department of Housing and Urban Development. The suit challenges HUD’s abrupt cancellation of grant funding that longtime recipients had expected to receive, after months of delays and uncertainty. Read the full press release here. On September 30, a district court judge indefinitely suspended the deadline for HUD to award the housing counseling funds until the court issues a final ruling.

On Friday, September 25, the Trump administration announced they are attempting to claw back more than $800 million in congressionally appropriated funds in what is called a pocket rescission. This pocket rescission includes the $56 million in HUD comprehensive housing counseling grants that the NC Housing Coalition, among others, access on behalf of housing counseling agencies across North Carolina in order to provide first-time homebuyer education, foreclosure prevention, and more. Congress has 45 days to override a pocket rescission, but they are out of session and will not be back in session until after the midterm elections in November. As it stands, there is no possibility for a vote to override.

Because HUD’s housing counseling funds are paid through reimbursement, the rescinded funds are owed for work that has already been done and is ongoing. The funds were already at risk of being de-obligated if they were not awarded by the 30th, and they had already been delayed since before October 1st of last year. The loss of this funding will be catastrophic for the housing counseling network here in North Carolina and around the country. The delay of this funding has already resulted in the loss of services throughout the state, and canceling the funds altogether will mean that North Carolina families will lose access to a vital financial education resource at a time when housing costs are at all-time highs.

Contact Your Representatives Call Senator Budd, Senator Tillis, and your congressperson today to let them know how this impacts your organization and your community, especially if you are a housing counseling agency. The White House press release called into question the effectiveness of delinquency and default counseling, despite an overwhelming amount of research showing its effectiveness, especially during the foreclosure crisis. Let your representatives know about the transformative impacts housing counseling has in their districts.

Contact Sen. Tillis (202) 224-6342 Email

Contact Sen. Budd (202) 224-3154 Email

Find Your Congressperson

Housing Minute Executive Director Samuel Gunter addresses the pocket rescission and the loss of housing counseling funds in the latest Housing Minute: