The more than 100 foreclosures homes for sale in Long Beach, California that will be fixed by the city with funds from the Housing and Urban Development Department will help solve the problem of abandoned foreclosures in the city.
In the second round of Neighborhood Stabilization Program allocation, the HUD gave $22.25 million to Long Beach to help cut down the number of its foreclosure properties. The city was one of 12 cities, counties and nonprofits in California that received money from the second funding round.
All in all, California got a total of $318.05 million from the HUD, the second-highest state allocation. Florida got the highest amount – $348.31 million.
Dennis Thys, director of the Long Beach Community Development Department, said he will travel to Washington, D.C. this week, together with representatives of all other fund recipients, to attend a meeting on how the funds will be disbursed and how soon they can be used.
Thys said there are already about 50 residents who have prequalified for the city’s NSP-funded home ownership program. The second-round funding is expected to help about 111 lower-income buyers.
Thys also said that the city will partner with nonprofit Habitat for Humanity to help families buy foreclosures homes for sale, with Habitat expected to buy, fix and resell more than 25 houses.
The California unit of Habitat was given $13.41 million by the HUD for its affordable program in the state. For its programs in five states, Habitat received a total of $137.62 million.
According to director Thys, the second funding round is better for communities than the first funding round, which required recipients to buy vacant houses at 15 percent below their appraisal value. HUD was later informed that the requirement was pushing property values further down. Foreclosure properties would be purchased at fair market value, according to Thys.
Financial assistance will be distributed among three types of applicants: families earning very low incomes or 49 percent or lower of the median income in Long Beach; families earning low incomes or 50 to 80 percent of the median income; and families earning working-class incomes or 81 to 120 percent of the median income.
Realtors, such as Lynda Montgomery, are calling on officials to also set aside some NSP money to help abandoned foreclosure pets and animal shelters because these pets also cause neighborhood problems if they are ignored.
However, the funds may be easily exhausted as there are a lot of foreclosures homes for sale in the city that need to be fixed.