Tuesday, October 27, 2009

Guest Blogger Sharon Price: Reflecting on Rhode Island's Creative and Effective Use of NSP Funds

Across the country, Neighborhood Stabilization Program (NSP) grantees and their partners are busy implementing their programs—working with mortgage servicers to purchase properties and with local partners to rehabilitate homes and secure new homeowners and renters. Under NSP1, HUD allocated $3.92 billion on a formula basis to 309 states, territories and local governments. The program was designed to stabilize communities across America hardest hit by foreclosures.

As a small state, Rhode Island received the minimum allocation for state grantees of $19.6 million. They have taken a number of creative approaches to utilizing their funds quickly and efficiently. Within the NSP guidelines, their statewide NSP plan set parameters for their grant funds which are being utilized in 11 communities. They began an NSP Homebuyer Assistance Program in targeted communities, and have already reserved all funds set-aside for that purpose. As this recent article shows, they are also rehabbing foreclosed properties in communities such as Warwick across the state through local partnerships between municipalities and nonprofits.

To learn more, please view the information below, which details how and where NSP funds are being used in Rhode Island.

Funds are targeted to areas:
  • With the greatest percentage of foreclosures;
  • Highest percentage of homes financed by subprime mortgage related loans; and
  • Identified as likely to face a significant rise in rate of home foreclosures.
Eligible activities include:
  • Establish financing mechanism for purchase and redevelopment of foreclosed upon homes and residential properties, including such mechanisms as soft-seconds, loan loss reserves, and shared-equity loans for low- and moderate- income homebuyers;
  • Purchase and rehabilitate homes and residential properties that have been abandoned or foreclosed upon, in order to sell, rent, or redevelop such homes and properties;
  • Establish land banks for homes that have been foreclosed upon;
  • Demolish blighted structures; and
  • Redevelop demolished or vacant properties.
Sharon Price serves as NHC's policy director.

No comments: