Charitable Organizations Increase Aid to Reduce Foreclosures
About 50 of the biggest charitable organizations in the United States have committed to donate over $100 million grants to help borrowers avoid foreclosure, prevent hunger and provide financial counseling.
Senior director of Foundation Center's research, Steven Lawrence said that the grants are just the start of institutional giving during economic recession.
His report about institutional giving showed that charitable organizations are responding to economic hardships and are committed to helping owners of distressed properties.
According to Lawrence, many organizations have experienced a decline in their assets in 2008. But despite this decline, many of these organizations are still committed in institutional giving, especially in helping people who lost their homes to foreclosure.
In fact, the Bill and Melinda Gates Foundation had announced that it would step up its charitable giving by 7 percent from 5 percent. The foundation made this announcement despite an almost 20 percent decline in its assets.
This indicated that many charitable organizations are increasing their institutional giving more than 5 percent of their assets as required by the U.S. Internal Revenue Service to continue supporting their causes, such as helping owners of repossessed homes.
Lawrence believed that despite the severity of the economic crisis, many charitable organizations have made adjustments to allow them to honor their commitments and better respond to immediate problems such as foreclosure.
According to Foundation Center's report, most of the big charitable organizations have focused their emergency giving local.
For example, the John D. and Catherine T. MacArthur Foundation donated a total of $34 million grants for foreclosure prevention and to help renters retain their houses in Chicago, Illinois.
MacArthur Foundation President Jonathan F. Fanton disclosed that the value of the organization's assets declined by 20 percent in 2008. But the organization was able to give away $25 million higher than the total amount it donated in 2007.
On his part, Lawrence was curious over the large amount donated by foundations to help borrowers avoid foreclosure, claiming that this is not a standard area of institutional giving.
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