Tuesday, May 25, 2010

HUD’s Response to Foreclosures is Evolving

As home foreclosures continue to cause suffering in neighborhoods across the country, the Administration has announced that it will seek to refine and expand one of the largest Federal programs addressing the crisis.

At a roundtable last week, U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan announced that the Administration aims to allocate more Federal funds for the Neighborhood Stabilization Program (NSP) to help hard-hit communities rebuild as the housing crisis continues.

NSP was originally created with $4 billion in funding through the Housing and Economic Recovery Act of 2008 to allow state and local grantees to shore up abandoned and foreclosed properties, rehabilitate those properties, and put them back on the market. The program received an additional $2 billion through the Recovery Act, leading to a highly competitive second round of “NSP2” awards given to grantees performing particularly well in struggling communities.

NSP has already had a extensive and direct impact across the country. HUD estimates that the first round of NSP funds will help make over 63,000 homes available for families with low- to moderate- incomes with over 17,000 units already completed. Take a look at a local NSP “snapshot” to see how the program has affected your community.

The Administration now says it will work with Congress to secure a third round of NSP funding, and reallocate about $1 billion from previous awards which current grantees have yet to spend.

HUD believes additional funding and technical changes will “improve the flexibility and impact of the NSP program.” Please read the full press release for more details.

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