Stabilization Program Readies Funds for Florida Foreclosures Rehab

South Florida registered 8,000 foreclosed homes during the first 10 months of 2008. To address this crisis and help local government officials deal with the problems attributed to foreclosures, the federal government has released $3.9 billion as funds for the Neighborhood Stabilization Program. $104 million will be allocated for South Florida’s cities and counties and will be used to purchase foreclosed properties for rehabilitation.

The local governments will either resell these properties to low or middle income families, rent them out to local residents or dole them out as grants. The main goal is to convert abandoned foreclosures into habitable abodes for residents and stop the continuing decline of property values in neighborhoods that were hard-hit by the crisis.

Although the local officials are generally grateful for the grant money, most are expecting that only a few foreclosed homes will be successfully rehabilitated due to the limited amount of these funds. Still, they are happy to receive something instead of nothing.

In addition to this concern, real estate agents are worried that the funds could be mismanaged. They pointed out that local governments are not realtors and unless they get good advice on how to use these funds, the programs enacted are doomed to fail. The plan to resell foreclosed properties would be a good approach as long as the local officials could get buyers for the rehabilitated homes.

However, trying to sell these homes at much discounted prices could have repercussions as it could cause depreciation on home values of adjacent properties. These points were taken into consideration as the cities finalized the proposals on how to utilize the funds for submission to the Department of Housing and Urban Development (See HUD Homes).

As soon as the programs were announced to the public, many residents are planning to participate in the deal. Most are first-time homebuyers who wanted to have a home of their own in a good neighborhood. These families should qualify for the requirements of the grant and should be earning more than 120 percent of the county’s median income.

Related Posts:

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• $153 Million Aid for Georgia's Foreclosed Properties
• Foreclosed Property on Sale in Coachella Valley, California
• Fontana City Officials May Buy Foreclosed Properties to Rehabilitate and Sell
• Communities Seek Help for Declining Neighborhoods due to Foreclosures