Foreclosure List Homes in Virginia Fixed with Nearly $4B

Foreclosure list homes in Virginia will be purchased

, rehabilitated and sold by nonprofits and state and local agencies with a total of $3.92 billion in funding from the federal government under the Neighborhood Stabilization Program.

The funding was approved by the federal government last year, but the facility to access and use the money will be made available only these coming months.

The state of Virginia was allocated a total of $38.7 million, which the Virginia Department of Housing and Community Development is expected to distribute to nonprofits and local governments that will manage the acquisition, rehabilitation, resale or lease of foreclosure properties.

The counties of Prince William and Fairfax applied separately for NSP grants and received $4.1 million and $2.8 million, respectively. The grants were approved based on the conditions of neighborhoods battered by foreclosures.

In April, Governor Tim Kaine announced the approval of $7 million in NSP grants and announced $9.4 million 4 months later. Chesapeake City was allocated with $1.5 million while the Virginia Beach Community Development Corporation was allotted $1.2 million.

Alisa Winston, housing coordinator for Chesapeake, said the city has not yet received the money, but her team planned to buy around 12 foreclosure list homes in the neighborhoods of Western Branch and South Norfolk.

She added that her program limits repair costs to $25,000 for each house and $40,000 for a property with lead contamination so that the money can be stretched to buy more units. Sales from repaired units will be used to buy additional foreclosures to repair.

Mary Kay Horoszewski, head of the Virginia Beach CDC, said her organization will buy and repair foreclosure homes and then sell them to low-income and moderate-income families.

Nonprofits and local government agencies are given 18 months to budget the money for their programs and 4 years to carry them out. Any excess funds must be given back to the U.S. Treasury.

Based on data from the Virginia Department of Housing and Community Development, the state foreclosure rate has increased to nearly 2 percent in June 2009, up from only 0.24 percent 4 years ago.

Over 28,000 homeowners in the state are in default or foreclosure and over 16,000 foreclosed units are vacant, according to the agency.

The three cities with the biggest number of foreclosure list homes in Virginia are Virginia Beach, Chesapeake and Norfolk. Housing analysts cite the large proportion of subprime loans taken out by homeowners in the three cities during the boom.

Foreclosure List Homes in Virginia Fixed with Nearly $4B

By: JosephSmith

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