Neighborhood Stabilization Program to Buy Bank Foreclosure Properties

by Simon Lindsay on Foreclosure Help

Volusia County and several cities, including Palm Coast, Daytona Beach and Deltona are given 18 months to spend the funds they received in March to purchase bank foreclosure properties.

In Volusia, the program to purchase and sell foreclosure properties are in place and operational. A telephone line is made available for people who want to call to refer bank foreclosure properties that may qualify for the federal funds under the Neighborhood Stabilization Program (NSP).

The federal program is designed to buy and sell abandoned, vacant and foreclosed homes in neighborhoods hardest hit by the foreclosure crisis.

However, the program is a bit slow in taking off in cities of Palm Coast in Flagler County, Daytona Beach and Deltona.

Officials in Palm Coast and Deltona are hoping that the program will start to show some movement by July. Deltona aims to kick start the program after July 20. The city has 24 percent of the total foreclosure properties in Volusia.

The City Commission of Deltona plans to meet on July 20 to try to approve a streamlined list of consultants, from general contractors to appraisers.

Planning and development services director of Deltona Chris Bowley said that the city has a large volume of bank foreclosure properties and already, it has sent out requests for proposals. He added that the city is also working on a short list of potential consultants and after the meeting, it will advertise and the wheels of the program will start turning then.

The funding for Volusia County and Deltona came from the U.S. Department of Housing and Urban Development’s (HUD) NSP which is one of the programs approved under the Housing and Economic Recovery Act of 2008.

In September last year, the HUD awarded about $450 million to 48 cities and counties in Florida. Deltona received $6.6 million while $5.2 million were earmarked for Volusia. The amount that a city or county may receive depends on the number of mortgage defaults and foreclosures in the area.

Under the program, all funds received should be used to buy, rehabilitate and sell foreclosure houses and to provide deposit and closing cost. Furthermore, a portion of the fund is allotted for rental housing for low-income families.

Currently, Volusia County has 9.728 preforelcosure and Bank Foreclosure Properties, 2,375 in Daytona Beach and 1.870 in Palm Coast.