November 13, 2003
BUSH ADMINISTRATION ANNOUNCES MORE THAN $37 MILLION IN GRANTS TO PROMOTE HOMEOWNERSHIP AND HOUSING FOR LOW-INCOME FAMILIES
An estimated 730,000 individuals and families to benefit from housing counseling
WASHINGTON - Nearly 730,000 individuals and families will have a greater opportunity to find housing or keep the homes they have because of more than $37 million in housing counseling grants announced today by Housing and Urban Development Secretary Mel Martinez.
It is estimated these grants will assist more than 430,000 people to either become first-time homeowners or remain homeowners after their purchase. The grants were awarded to 17 national and regional organizations and approximately 350 state and local housing counseling agencies. These organizations will provide counseling services and will help meet the Bush Administration's goal of increasing minority homeownership by 5.5 million families by the end of the decade.
"These housing counseling grants are an important part of this Administration's goal to expand homeownership opportunities, particularly for minorities," said Martinez. "President Bush and I are committed to opening the doors to the American Dream to more American families."
The 17 national and regional agencies distribute much of the HUD funding to community-based grassroots organizations that provide free advice and guidance to low- and moderate-income families seeking to improve their housing conditions. In addition, these larger organizations help improve the quality of housing counseling services and enhance coordination among other counseling providers. Notably, 3 of the 17 intermediaries are faith-based, including 2 that are first time housing counseling grant recipients.
Of the $37.561 million in grants, $2.7 million is being awarded specifically to combat predatory lending, including awards to 4 national and regional intermediaries and 34 state and local organizations. Grantees will assist unwary borrowers in avoiding unreasonably high interest rates, inflated appraisals, unaffordable repayment terms, and other conditions that can result in a loss of equity, increased debt, default, and even foreclosure.Additionally, $2 million is being awarded specifically for counseling in conjunction with HUD's Section 8 Homeownership Voucher Program, which allows low-income individuals to use rental vouchers to purchase homes. Awards under this category are made to 4 national intermediaries and 35 state and local agencies. These grant recipients will help program participants realistically evaluate their readiness for a home purchase, understand their financing and down-payment options, and navigate what can be an extremely confusing and risky process.
President Bush is proposing to increase HUD's Housing Counseling grant program to $45 million next year - a 12.5 percent increase. The organizations that provide counseling services help people become or remain homeowners or find rental housing. In addition, HUD-funded housing counseling agencies assist homeless persons to find the transitional housing they need to move toward a permanent place to live.
Who benefits from housing counseling?
Based on past experience, HUD anticipates the counseling grants announced today will enable approximately 257,000 would-be homeowners to learn how to improve their credit, strengthen money management skills and avoid predatory lenders and other unscrupulous practices. Another 175,000 existing homeowners will learn how to avoid delinquency and default, restructure debt and maintain their home. In addition, nearly 213,000 individuals and families who will receive HUD-funded counseling are renters. Counseling services will help them find housing closer to their jobs or health care as well as teach them about tenant rights. Finally, an estimated 16,000 homeless individuals and families will learn how to find emergency services and secure transitional housing.
HUD awards annual grants under this program through a competitive process. Organizations that apply for grants must be HUD-approved and are subject to biannual performance reviews to maintain their HUD-approved status.
HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities, creating affordable housing opportunities for low-income Americans, supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development as well as enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet.
Note to editors: To view A state-by-state breakdown of grant recipients visit /news/2003/statebystategrant.pdf.
To view detailed individual grant summaries visit /news/2003/housingcouseling03.pdf.