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Tuesday, May 01, 2007

State Giving Money To Housing Groups.

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posted by Bob at Tuesday, May 01, 2007

3 Comments:

Blogger Bob said...

Twin Cities get $11.5M in housing aid
Money will help restore, resell homes lost to foreclosure, mostly in North Minneapolis
BY JENNIFER BJORHUS
Pioneer Press
Article Last Updated: 04/30/2007 09:26:02 PM CDT


The state is giving Twin Cities housing groups $11.5 million to buy, fix and resell empty homes in core neighborhoods hard hit by the recent wave of residential foreclosures.

Nearly all the money will be spent in North Minneapolis, where foreclosures have been most heavily concentrated. St. Paul is getting a $500,000 grant to buy up houses in the Dayton's Bluff area that troubled mortgage lender Residential Capital is marking down, a city official said.

The package of loans and grants, which the Minnesota Housing Finance Agency announced Monday, is the largest local effort to date to address the foreclosure crisis. They're the result of proposals submitted to the housing agency by members of the Foreclosure Funders Council, a local group formed earlier this year. St. Paul received only $500,000 because "they only asked for $500,000," said agency spokesman Megan Ryan.

The aid focuses on buying empty homes since the state already has a network of foreclosure-prevention counselors in place, Ryan said. Buying homes for resale also lends added stability to the neighborhoods, she said, by ensuring that the houses go to new owners, as opposed to landlords who will rent them.

There's plenty to choose from. Foreclosures nearly doubled in the Twin Cities last year and this year doesn't look much better. In just the first three months of this year, 2,785 Twin Cities homeowners lost their homes in sheriff's sales, more than in all of 2002 or 2003. Foreclosed homes
wind up back on the market, helping to drive the record number of 32,114 for-sale signs across the metro area.
The Family Housing Fund and the Greater Metropolitan Housing Corp., two Minneapolis-based nonprofits, together are getting $11 million to rehabilitate single-family houses. Of that, $10 million is a three-year loan with a 3 percent interest rate. The remaining $1 million includes a $650,000 grant to offset rehab costs, and a $350,000 interest-free loan to assist families buying the houses.

In St. Paul, the Housing and Redevelopment Authority, part of the city's Planning and Economic Development Department, is getting a $500,000 grant. The money is targeted for 10 to 12 single-family houses in the Dayton's Bluff area.

Tom Sanchez, East Team Leader for the city's Department of Planning and Economic Development, said the city considers the new program a pilot project and wanted to test it before buying up a lot of houses.

It's busy browsing the foreclosure properties that Residential Capital, or ResCap, the troubled Bloomington-based unit of GMAC Financial Services has in inventory, Sanchez said. It's looking for houses with three bedrooms or more and expects to spend $50,000 to $75,000 per house to fix them and get new owners in. He expects Habitat for Humanity to do some of the rehab work.

ResCap is discussing marking down its properties about 40 percent, Sanchez said.

"If this works, then we're going to be talking with other lenders," Sanchez said.

Jennifer Bjorhus can be reached at jbjorhus@pioneerpress.com or 651-228-2146.

9:09 AM  
Anonymous Anonymous said...

I guess we can see once again what the objective of St.Paul is;

"Buying homes for resale also lends added stability to the neighborhoods, she said, by ensuring that the houses go to new owners, as opposed to landlords who will rent them."
(BY JENNIFER BJORHUS
Pioneer Press
Article Last Updated: 04/30/2007 09:26:02 PM CDT)

What about the families that can't afford to purchase a home or don't meet the credit criteria that is required are those families suppose to just go homeless then?

9:20 AM  
Anonymous Anonymous said...

Pretty good scam for the city. Come and lie about repairts to condemn the house and force the owner into forclosure with their criminal code enforcement, then the city gets to buy the property at huge discounts from the injured lender, who also happens to scared by the way because the city threatens on a dailey basis to tear down homes even if there is a mortgage on them. And Repke is always saying that the cioty is not making any money when he refers to the Racketeering lawsuits? The way it looks to me, they sure aren't losing any money when they are buying up the town at half price!

5:12 PM  

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