Archive for the 'cities' Category

Some families in Franklin, Virginia could soon be owners of affordable houses if the city’s application for a federal grant would be awarded under the Neighborhood Stabilization Program (NSP).

The NSP, administered by the U.S. Housing and Urban Development (HUD), is part of the Obama Administration’s program to alleviate the impact of the foreclosure crisis on severely affected neighborhoods across the country.

The grant is coursed through the Virginia Department of Housing and Community Development. The agency is set to award $503,519.91 to the city of Franklin to allow it to purchase and renovate vacant and bank foreclosed houses and sell them to eligible low-income and medium-income families.

According to industry experts, Franklin is competing for the grant with other counties and cities across the state. Previously, the city received a planning grant amounting to $25,000 under the Department of Housing and Community Development. The grant was used to study the effects of the foreclosure crisis in the city.

City officials clarified that the federal grant is intended for use to prevent foreclosure houses from becoming breeding grounds of crimes in neighborhoods. They pointed out that the funds will not be used to help distressed homeowners save their properties from foreclosures.

They added that the money is intended to remove blights that foreclosure homes have become, noting that vacant properties attract vandals and vagrants.

So far, the city has identified some properties to be acquired and rehabilitated in Meadowbrook and Oldtown neighborhoods. Under the plan, the city will purchase the foreclosed homes at 15 percent less than their assessed value in order to sell them at affordable rates.

To qualify, prospective buyers should complete a homeownership course. Meanwhile, families who will qualify to purchase homes under the program may also have the opportunity to apply for a program that provides down payment assistance and closing costs.

The city is expecting to have some competition with investors who pay cash to buy bargain-priced foreclosure properties to rent.

Data provided by HUD showed that Franklin has the third highest foreclosure rate-per capita in Virginia. Industry experts projected that the city’s foreclosure rate will continue to increase given the worsening economic downturn and the rising unemployment rate.

The Federal Reserve and Massachusetts Housing Partnership said that Brockton is the city with the highest number of bank foreclosed homes for sale in the state last month.

According to market data, about 34,794 properties in the city were in some kind of foreclosure process. These figures include apartment units. The July numbers represented a 1 percent drop since October 2008.

Janine Carreiro of the Brockton Interfaith Community said that she is not surprised over the report that Brockton has the highest number of foreclosure properties in the state. She said that out of 1,000 houses in the city, 43.8 are distressed properties or in some kind of foreclosure proceeding. City zip codes with highest repossession rates are 02 and 02301.

Mayor James E. Harrington said that the high foreclosure rate in the city is the reason why the local government applied for federal funds.

Industry analysts said that homeowners go into foreclosures because of deceptive or predatory lending and unemployment. They said that federal initiatives aimed at alleviating the effects of foreclosure have just recently obtained by the city, with some still coming.

But analysts pointed out that a bulk of the funding is allocated to helping neighborhoods severely affected by foreclosures and not on helping distressed homeowners avoid foreclosures and remain in their houses.

Building a Better Brockton Corp. Chief Executive Officer and President Donald Walsh said that the number of foreclosure properties is highest in the city because of the volume of subprime loan deals, rising unemployment and lack of preparedness. He added that part of the city’s problem is the absence of organizational infrastructure to handle the foreclosure crisis.

The city received financial help to alleviate the foreclosure problem, including $2.1 million under the Neighborhood Stabilization Fund and $1 million state fund to purchase and renovate foreclosure houses.

At the same time, Brockton also applied for $21 million under the Neighborhood Stabilization Program 2. Other federal grants are available to help distressed homeowners bring down their mortgages to no more than 31 percent of their gross monthly income.

Industry experts said that foreclosure clinics are held every two weeks by the Neighborhood Housing Services, adding that any effort that aims to prevent the spread of foreclosure is positive.

The city of Kenosha in Wisconsin is planning to use the almost $1.7 million in federal funds to buy properties on foreclosed home listings. Recently, members of the Kenosha council approved the collaboration between the city and the Wisconsin Department of Commerce for a federal neighborhood stabilization program.

Under the program, the state is set to award the city as much as $1.73 million as part of the federal program which is intended to address the increasing number of foreclosure properties in the area.

The funds, made possible under the American Recovery and Reinvestment Act, will be used to buy abandoned or foreclosure homes and then renovate or rebuild them. According to the city’s plan, it will purchase eight distressed properties and renovate six of them. It also plans to demolish and rebuild two properties using the federal funds.

Under the plan, foreclosed properties that would be acquired must be located in neighborhoods with high number of distressed properties. Industry experts said that areas hardest hit by the foreclosure crisis are those with old houses and majority of residents belong to the low and middle income categories.

The Kenosha government is committed more on buying and rehabilitating foreclosed houses because the program sets strict standards for abandoned properties. Industry analysts said that the city would likely stay away from bank foreclosed homes because many of them are still occupied by homeowners.

Kenosha city is required to place under sale contract all properties by August 15, 2010. It is scheduled to complete all reconstruction or rehabilitation activities by February 2013. According to city officials, the money for the program was authorized last February. However, the allocation process indicated that it is just about to be approved.

They said that the city is time constrained to get things on the move, adding that the program is under aggressive schedule. They hope that they could complete their target numbers on time. City officials said that they will soon start searching for potential properties for the program, adding that they are confident that they could accomplish their target.

In the event that the city failed to meet the requirements set by the program, Wisconsin has the right to reallocate the city’s funding. Kenosha also plans to use a portion of the funds to provide second mortgages for prospective homebuyers.

The number of investors who purchased new and previously owned single-family detached houses in Las Vegas increased in June, based on data gathered by housing analysts.

The overbuilding of high-rise condo buildings in San Diego has substantially increased the number of San Diego condo units entering bank foreclosure list inventories, according to local real estate data.

Job losses or significant declines in earnings, and not subprime mortgage loans, were the main causes of foreclosures in Philadelphia, according to Pennsylvania housing analysts.

Total home sales soared in the Las Vegas metro area in June, driven by a large percentage of foreclosure for sale, based on real estate sales data in Nevada.

An increase in the number of foreclosed condos in the Chicago suburb of Buffalo Grove is set to occur after Harris Bank sued to foreclose Buffalo Creek Condominiums, a 154-unit condo complex bought for $13.25 million by investor Marcin Malarz in February last year.

Investors and prospective home buyers can take a look at the nearly 300 foreclosed homes for sale in Myrtle Beach, South Carolina.

The city of Chula Vista in California had imposed an ordinance that became a national model for mandating that lending institutions maintain abandoned and vacant bank owned foreclosure to prevent them from becoming blights to neighborhoods.