Living inside the Beltway, the foreclosure crisis has had minimal impact on my neighborhood. In fact, I learned about the crisis by turning on CNN or reading the Washington Post. Initially, the news focused on one measure of this phenomenon – plummeting housing values (albeit by modest amounts in some parts of Washington). More recently, the news focused on the public debate on the government response: Should we have bailed out the homeowners — and not just the banks?

The Eye-Opener: What “REO” Really Means for Our Nation

But for me, what was an eye-opener was attending the National Community Reinvestment Coalition’s annual conference, “Roadmap to a Financially Inclusive Society,” held in Washington, DC. Particularly informative was the workshop “Reclaiming REO Properties: Avoiding Blight and Decay in Neighborhoods Afflicted With Foreclosures.” I learned the true meaning of the acronym “REO.” What I learned is that the term “real-estate owned” is not just banking jargon. The term means the exodus of residents from entire neighborhoods in many areas of the country, such as Cleveland. It means a declining local tax base that can no longer support the delivery of basic human services. And although we are seeing some glimmers of hope, it could potentially mean the emergence of Hoovervilles (to borrow a term from the Great Depression) around the country. In other words, “REO” refers to our nation’s new social reality.

The Answer to Social Distress: Bottom-up Solutions

With this insight, I propose a “bail out” of another actor in the foreclosure crisis -– housing counselors. Their challenge is not only a recent exponential growth in their caseloads — but also client human needs that go beyond their job description. Client appeals for help, for example, with a marriage that is dissolving under the stress of foreclosure or with the child who is acting out the family trauma.

While the Obama administration supports programs to help housing counselors, for example, the HUD program that designated NCRC as a national housing counseling intermediary, this human crisis also needs bottom-up solutions. We can’t wait for all of the solutions to come from Washington. In other words, some of the solutions must come from civil society – or to put it plainly, allied nonprofits and people like you and me.

At the workshop, an NCRC member spoke about the need for a consolidated network of housing counselors that would foster mutual assistance and disseminate best practices in case management. There exists a housing counselors network in some states, he explained, but not in others.

This past November, NCRC member California Reinvestment Coalition and the Rural Communities Assistance Corporation brought together seventy mortgage counselors in a peer-to-peer convening in Sacramento. The groups shared successful strategies and frustrations in helping borrowers resolve their troubled mortgage situations — thus, energizing participants in developing new strategies.

But again, this outreach needs to take place on a consolidated, national basis. In my view, the sponsorship of an online discussion group dedicated to housing counselors for mutual assistance might be that needed first step.

Readers, any other ideas out there to guide this proposal along?