HUD Archives: News Releases

HUD No. 09-025
Brian Sullivan
(202) 708-0685
For Release
March 19, 2009

Funding aimed at neighborhoods hard-hit by foreclosure

WASHINGTON - U.S. Housing and Urban Development Secretary Shaun Donovan today approved nearly $731 million in funding for 48 States and local communities seeking to recover from the effects of high foreclosures and declining home values. Funded under HUD's Neighborhood Stabilization Program (NSP),these plans will target emergency assistance to particular neighborhoods by acquiring and redeveloping foreclosed properties that might otherwise become sources of abandonment and blight (see attached chart).

The neighborhood stabilization plans approved today include a $145 million plan submitted by the State of California, a program President Barack Obama recognized during a town hall meeting today in Los Angeles.

"These funds will be used to buy up and rehabilitate vacant foreclosed homes and resell those homes with affordable mortgages," said President Obama. "They'll allow California to provide mortgage assistance and rehabilitation loans for both low-income and middle-income families. This is how we'll help people here in California live their dream of homeownership and how we'll start transforming abandoned streets lines with vacant houses into thriving neighborhoods."

"Our goal is to help communities throughout California turn these houses into homes again," said Donovan. "California is clearly struggling with a brutal foreclosure crisis and we must make every effort to help to help communities prevent these foreclosed properties from becoming a source of neighborhood blight."

HUD's Neighborhood Stabilization Program was created under the Housing and Economic Recovery Act of 2008 and provides nearly $4 billion to every State and certain local communities experiencing particularly high foreclosure problems and risk of property abandonment. The program permits these State and local governments to purchase foreclosed homes at a discount and to rehabilitate or redevelop them in order to respond to rising foreclosures and falling home values.

In addition, the American Recovery and Reinvestment Act of 2009 makes available another $2 billion of NSP funding to State, local governments, non-profit entities, or consortia of non-profit entities for similar anti-blight and stabilization efforts. HUD will issue a funding notice with application requirements no later than May 3, 2009. Applicants will prepare an application and, for programmatic funding, complete citizen participation before submitting to HUD. HUD will review applications and make awards shortly thereafter.

State and local governments can use their neighborhood stabilization grants to acquire land and property; to demolish or rehabilitate abandoned properties; and/or to offer downpayment and closing cost assistance to low- to moderate-income homebuyers (household incomes not exceed 120 percent of area median income). In addition, these grantees can create "land banks" to assemble, temporarily manage, and dispose of vacant land for the purpose of stabilizing neighborhoods and encouraging re-use or redevelopment of urban property.

The NSP Program also seeks to prevent future foreclosures by requiring housing counseling for families receiving homebuyer assistance. In addition, the Agency seeks to protect future homebuyers by requiring States and local grantees to ensure that new homebuyers under this program obtain a mortgage loan from a lender who agrees to comply with sound lending.


HUD's mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD is working to strengthen the housing market to bolster the economy and protect consumers; meet the need for quality affordable rental homes: utilize housing as a platform for improving quality of life; build inclusive and sustainable communities free from discrimination; and transform the way HUD does business. More information about HUD and its programs is available on the Internet at and You can also follow HUD on twitter @HUDnews, on facebook at, or sign up for news alerts on HUD's News Listserv.

State Community
Grant Amount
California Antioch
  California State Program
  Stanislaus County
District of Columbia Washington
Florida Deltona
  North Miami
  Sarasota County
Iowa Iowa State Program
Indiana Indiana State Program
Maryland Prince Georges County
Michigan Canton Twp
  Genesee County
  Grand Rapids
  Kent County
  Lincoln Park
  Macomb County
  Michigan State Program
  Oakland County
  Wayne County
Mississippi Jackson
Montana Montana State Program
Nebraska Nebraska State Program
Nevada Clark County
  North Las Vegas
New York Nassau County
  Orange County
Tennessee Knoxville
  Tennessee State Program
Texas Dallas County
  Fort Bend County
  Grand Prairie
  Harris County
Insular Areas American Samoa
  Mariana Islands
  U.S. Virgin Islands


Content Archived: March 25, 2015