Henderson working out details of $4 million foreclosure program

By Jeremy Twitchell

Thursday, April 16, 2009 | 4:50 p.m.

Henderson housing officials are trying to work out the logistics of a federal program that will give the city nearly $4 million to help qualified families and individuals purchase foreclosed homes.

The Neighborhood Stabilization Program is giving municipalities nationwide money to aid home-buyers with down payments, closing costs, mortgage rate buy-downs and rehabilitation expenses.

Henderson Affordable Housing Coordinator Doug Kuntz said the money already has been set aside for Henderson, but the guidelines for obtaining it and using it are still murky, as are the reporting requirements the city will have to follow. He said the city is working with the Department of Housing and Urban Development, which oversees the program, to work out the confusion.

“The regulations, HUD’s not even fully understanding them to be able to explain them to us,” Kuntz said.

But there has been progress, Kuntz said, and he is optimistic that the program can be ready to launch in May.

Henderson’s Neighborhood Services Department, which will administer the program in Henderson, already has been sending potential participants to a required eight-hour homeowner’s seminar so the process goes quickly when it begins, he said.

Elected officials in Henderson harshly criticized the program when it was announced last year, saying the money would have been better spent helping families avoid foreclosure.

But, Kuntz said, the stabilization program will serve an important purpose by getting people into empty homes in areas of the city that have been hardest hit by foreclosures — homes that will become a serious nuisance if left vacant.

“If you drive around those neighborhoods right now, there are a lot of foreclosed homes, and those tend to attract vandals and vagrants,” he said. “If we can get some qualified people in those homes, it will go a long way in stabilizing those neighborhoods.”

The Neighborhood Services Department has identified nine census tract areas with the highest foreclosure rates where purchases will be eligible for the stabilization assistance. All nine areas are located within the 89014 and 89015 areas, which cover the northern part of Green Valley and the eastern part of the city.

Kuntz said program participants will be carefully screened for eligibility. To receive assistance, their monthly mortgage payment must be 30 percent or less of their income. Kuntz said the goal is to facilitate 50 to 60 home purchases with the money.

“We don’t want to over-subsidize, and we want to help as many people as possible,” he said.