Neighborhood Stabilization Program Begins
Cities and counties are now working as fast as they can to get their applications in for Neighborhood Stabilization Program (NSP) grants. The deadline in North Carolina to file a letter of intent is November 3rd. Its a short turnaround.
This is a program that is designed to help communities develop strategic plans to counter home foreclosures. In North Carolina, there is $52 million available. About one-quarter of that money has to go specifically to non-profits. There is also another $5.4 million set aside just for Charlotte. The applicant counties or cities are allowed to keep five percent of any allocated funds for their own administrative needs. While it sounds like a lot of money, its not nearly enough to handle the problem. In most cases, cities and counties will have to make a decision on where to triage the crisis.
If you are wondering who in your community has the ability to apply for these funds, the North Carolina list is right here. The national list is available from this site.
Another issue is the complexity of the application. Applicants have to identify the location of subprime loans, of defaults and delinquincies, and of foreclosures, in their communities.
It will be interesting to see how many applicants are able to provide that data, in less than a few weeks.
The money must go to programs that buy property that is going into foreclosure, into sales in lieu of a foreclosure, or that is blighted. Condemned properties would qualify. There is creative room to find ways to use funds to restore infrastructure. There is a criteria that requires that one-quarter of the beneficiaries of a project must be low-income.
It seems possible that this money could be utilized by an enterprising City or County to buy and rehabilitate a distressed mobile home park. Certainly, there would be the chance to help LMI families. One of the challenges of any multiple housing unit intervention is finding a way to negotiate with multiple lien holders, trustees, and servicers. Mobile home parks might be relatively easy. The land is probably going to be on one mortgage. Repairs for park infrastructure would qualify, too!
Filed under: Manufactured Housing in the News | Tags: foreclosures, Neighborhood Stabilization Program
Tony Orlando
October 14, 2008
Can you tell me who did your layout? I’ve been looking for one kind of like yours. Thank you.
pzeller
October 16, 2008
Helping communities develop strategic plans to counter home foreclosures with only $52 million may – at this time – be a bit late in the game. Foreclosure Prevention Programs have not been very successful in recent years.
The larger pool of families in need at this time, are the ones who have already lost their home to foreclosure. Their displacement has destabilized neighborhoods, school enrollment and left a gaping hole in the fabric of community that will – if left unaddressed – take many decades to repair.
In one American City, the Foreclosure Hotline boasts helping 4% (not a typo) of the callers actually keep their house. What happens to the 96% who are not candidates for the Hotline Program? They are foreclosed. Seems like a low success rate since almost 70% of the people who are foreclosed are gainfully employed.
Yet there is NO PROGRAM IN PLACE TO ADDRESS THE NEEDS OF THOSE WHO HAVE BEEN FORECLOSED.
I invite you to look at one of my ideas that can be a Grass Roots movement to reclaim our communities, help our neighbors and ourselves. It will take some funding assistance – hence the reason to raise a racket to local government, but I think the numbers bear out:
If the Post Foreclosure Program can save $8 million in municipal costs associated with foreclosure, would it be worth launching a pilot program to test the theory? A pilot program would likely cost less than $250K and could be accomplished in less than 6 months of testing for full scale launch.
Please view the white paper on the Post Foreclosure Program at: http://pzeller.wordpress.com/2008/08/14/foreclosureoptions/
I welcome comments and new ideas to make this Country and our neighbors secure in their home – even if they have to rent for a few years before we can get them back into home ownership. Respectfully, P. Zeller
Anonymous
October 16, 2008
Zeller-
I agree with you. Not enough is being done for families. The bailout is largely a bill in favor of Wall Street, as Sheila Bair pointed out this morning.
The $52 million is just for North Carolina. Its part of a $3.92 billion program in the Housing and Economic Recovery Act.
It is not a program focused on mortgage workouts. We really haven’t seen that program yet. It is a bill to help municipalities buy abandoned or foreclosed housing, rehab it, and return it the market (homeownership or rental) in short horizon.
valiera best
October 22, 2008
I am looking for a sample letter of intent for the neighborhood stabilization program