April 14, 2011; Source: Housing Wire | Some people view the $38.5 billion cut from the FY2011 continuing resolution as a tiny, inconsequential part of the budget, especially when Republicans are proposing to cut trillions, not billions when the debate shifts to the FY2012 budget.

The Department of Housing and Urban Development (HUD) is going to take a billion dollar cut in that FY2011 sum, a small part of a big budget, but important to the nonprofits that deliver and the populations that benefit from HUD’s services.

For example, within the HUD billion is $88 million dedicated to nonprofit housing counseling groups delivering first-time homebuyer counseling, post-purchase counseling, reverse mortgage counseling for seniors, and counseling for homeowners facing mortgage delinquencies and foreclosures. These are programs with documented evidence of success, no doubts about it, especially in light of how recalcitrant some lenders, mortgage brokers, and servicers have been about restructuring mortgages so that families might not have to lose their homes.

When the billion dollars in cuts came down, did HUD volunteer to sacrifice the counseling programs or was it the White House that gave up those program? Or did those specific program cuts emanate from the negotiators on Capitol Hill? Whatever the origin and evolution of the cut, we know what the results of zeroing out housing counseling will be.—Rick Cohen