Federal Funds to Ease Bank Foreclosure Listings in Nevada

by on States

A Southern Nevada county and three cities are planning to ask the federal government for additional funding to boost their programs designed to ease bank forclosure listings.

Clark County and the cities of North Vegas, Las Vegas and Henderson have banded together to ask the federal government for $368.2 million under the Neighborhood Stabilization Program (NSP). The NSP is part of the economic recovery package which has $787 billion in federal funds.

All in all, $1.93 billion is available from the U.S. Department of Housing and Urban Development (HUD) to be distributed to various areas in the country severely affected by the growing bank foreclosure listings. The funds will be used in programs that will help strengthen and stabilize communities affected by high home foreclosure rates and abandonment.

The local governments will avail of the NSP funds for the second time. By forming a consortium, the local governments will have a greater chance of getting the requested funds.

Clark County will act as the lead agency and the request for funding will be reviewed by commissioners. The three cities need to give their approval of the fund application before July 17.

The final amount that will be received by local governments will be determined by the HUD, according to Mike Pawlak, Community Resources Management Division manager.

He said that the request for additional funding is a national competition, adding that collaboration will give the county and cities a much better chance of getting the requested amount to help them streamline the bank foreclosure listings in the area.

The amount requested by the consortium accounted to about 19 percent of the total available federal funds. Meanwhile, Pawlak pointed out that whatever amount the consortium will receive would greatly help but will not put an end to the foreclosure problem in the metropolitan area of Las Vegas.

The areas in the Southern Nevada where the federal funds will be used earned an HUD rating of 19.93 for repossession and 17.3 average vacancy rating. The maximum HUD score is 20.

Industry experts said that the foreclosure crisis in the area will continue to rise because of the increasing unemployment and massive layoffs in the construction industry.

Several uses of the federal funds are new homebuyer counseling, assistance to reduce principal loan, down payment and redevelopment of properties on bank foreclosure listings.