Mike Posko, CEO of Habitat for Humanity of the Chesapeake, stands on the site of a Habitat for Humanity development which will be built in the Orchard Ridge community in northeast Baltimore.
Mike Posko, CEO of Habitat for Humanity of the Chesapeake, stands on the site of a Habitat for Humanity development which will be built in the Orchard Ridge community in northeast Baltimore. (Barbara Haddock Taylor, Baltimore Sun)

Mike Posko was building a house with Habitat for Humanity International — in Nepal — when the Baltimore-area affiliate emailed him late last year to ask him to come in for an interview.

He got the job.

Posko, who took over as Habitat for Humanity of the Chesapeake's chief executive in February, said he's passionate about the group's affordable-housing mission. The nonprofit builds new homes and rebuilds vacant ones in the Baltimore region with the help of volunteers, then sells them at no profit and with no-interest mortgages to workers with modest incomes. For instance, a family of two earning $40,000 or less a year would qualify.

The Baltimore-based Habitat employs 54 and has an annual operating budget of about $15 million. Officials there expect to complete 49 homes in the fiscal year that ends in June.

Posko comes from the world of business and government. After overseeing facilities and human resources at the Federal Reserve Bank of Richmond's Baltimore office, he worked for eight years as an executive at urban development firm Struever Bros., Eccles & Rouse. In 2010, he helped launch real estate venture Cross Street Partners with other Struever alumni after Struever Bros. imploded during the recession.

Posko, 53, lives in Pasadena with wife Diane and their five children and stepchildren. He spoke with The Baltimore Sun recently about his new job, how Habitat structures its deals and why its foreclosure rate is low.

What was the volunteer trip to Nepal like?

We built a home for a family in an area called Pokhara, and that's kind of near the foot of the Himalayas. … The family we built the home for was a family of four, a mother and father and two children, and when I say "home," it's not the home you might imagine. … Two rooms, 10 by 10 foot. And then there was what they call their bathroom, which was a hole in the floor that goes into a pit.

They were incredibly excited to have that home. It's a completely different lifestyle than we're used to. So you kind of get to know the culture a little bit.

How did you hear about the Habitat job opening? Did you reach out initially?

I actually got a number of phone calls from people who knew I had been talking about getting into the nonprofit arena.

Why did you decide this was the right time? You helped found Cross Street Partners — how is it doing? And why did you decide to leave?

One of the reasons I decided to start Cross Street Partners with Bill [Struever] and the three other partners was two years ago was an incredibly bad job market, especially for someone at a C level [the "chief" level of the executive ranks] like myself.

I, at that time, told them I would do it, but that ultimately I would be trying to change careers because of my passion in doing something with the nonprofits. … Cross Street is on its feet, it's had a great deal of growth just in the first year, so it was easy for me just to step away at that point.

I love the [Habitat] mission. We don't give away a house. We partner with the family. That family has to [put] 300 hours of "sweat equity" volunteer work back into the organization.

The role of subprime loans in the housing bust prompted a lot of angry conversations about how some Americans — those with lower incomes — should be renters, not owners. Why does Habitat feel differently?

I'm not a believer that the government should tell somebody whether they should be a renter or a homeowner. That's up to the individual.

Ultimately, somebody that's a homeowner ends up having better stability for their children, they have a better sense of dignity and pride, their health and physical safety and security improves.

Habitat's financing model is very different from subprime, too. Could you speak to that?

When we find a bank that will do the mortgages, we pay the interest so the bank still makes their money. We're able to put the homeowner in their home [with] an interest-free mortgage. … We're covering the gap by fundraising and corporate donations, sometimes personal donations.

What has the chapter's experience with foreclosure been?

Over the last 30 years, we've had about 2 percent foreclosed on. Of the 240 mortgages that are out there, between our own and the banks, we've foreclosed on two homes in the last two years, which is less than 1 percent. I think that's a good average.

What's keeping the number down compared with the country's high levels?

Besides the [financial] training we do [with families] … if somebody is a day late for making their mortgage payment, we've worked with the banks to say, "We'd like to know that." So our staff that works with the families calls, saying, "What's going on?"

Because of that, I think, we have a very high success rate of making sure they don't have problems with their loans.

What do you want to accomplish at Habitat?

One of the challenges is what to do in the counties, because land isn't as easily accessible in the counties [as it is in Baltimore]. But there's still a need for affordable housing there. So … [I want to get a] strategic plan in place.

I think the perception was that we're focusing on Baltimore City, and I want to change that perception. That's not what we're doing — we're focusing on our whole area, which includes Anne Arundel County and Baltimore County and Howard County. So some of my first meetings will be with county governments, county prospects for donors and things like that.

As you note, you're coming from the for-profit world to a nonprofit. What challenges do you foresee?

Asking for money is in some ways harder than trying to bid on a contract. So you have to go about it differently. You have to have a strong mission to ask for money and show them how you're spending the money.

It's been a rocky several years for the housing industry and for many charities. Is the chapter financially solid?

Yes. We've been very fortunate. … We've been able to manage through the [drop in] donations, and … vacant homes are cheaper. We can build a decent home that's affordable for the home buyer that others can't do in this economy.