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Housing crisis:

Program expanded to help more underwater homeowners

Reid, Titus tour Las Vegas neighborhood hit hard by foreclosures

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Jinae West

U.S. Department of Housing and Urban Development Secretary Shaun Donovan speaks Wednesday with U.S. Rep. Dina Titus (D-Nev.), right, during a tour of a Las Vegas neighborhood hit hard by foreclosures. HUD today announced an expansion of President Obama’s Home Affordable Refinance Program.

Updated Wednesday, July 1, 2009 | 1:16 p.m.

Mortgage help news conference

Senate Majority Leader Harry Reid (D-Nev.) speaks Wednesday at a press conference in a Las Vegas neighborhood, where U.S. Department of Housing and Urban Development Secretary Shaun Donovan, left, announced the expansion of President Obama's Home Affordable Refinance Program. U.S. Rep. Dina Titus (D-Nev.) is at right. Launch slideshow »

Foreclosure news conference

Senate Majority Leader Harry Reid (D-Nev.), joined by U.S. Rep. Dina Titus (D-Nev.) and U.S. Housing and Urban Development Secretary Shaun Donovan, toured a Southern Nevada neighborhood Wednesday hit hard by foreclosures.

Reid and Donovan walked down Pine Valley Drive, seeing for themselves the abandoned and unkempt houses that line the street. A podium was set up in front of a duplex. On one side was a newer-looking house with green vegetation; on the other, a foreclosed house with a "For sale" sign and a dull, brown lawn.

At the news conference, Donovan said more people would be eligible to qualify for refinancing under the Obama administration's Home Affordable Refinance Program. With the expanded eligibility requirements, he said the program now will allow homeowners who owe between 80 percent and 125 percent of their home's value to refinance. He said it does not require payment up front to participate in the program.

"I am also pleased to announce today that we will be bringing in HUD reinforcements on the ground here in Nevada to help Nevadans cope with the housing and economic crisis and give them the support and resources they need for long-term growth and sustainability in their communities," Donovan said.

Nevada has one of the highest foreclosure rates in the country with one in every 64 housing units receiving a foreclosure filing during the month of May.

"Today we stand at ground zero of the economic and housing crisis," he said.

He thanked Reid for helping to usher through the Recovery Act, which he said is President Obama's plan to restart the country's economy and stabilize neighborhoods. Donovan said the act is pumping $870 million into Nevada and is expected to preserve 34,000 jobs statewide.

"Through the $14 billion HUD received in the Recovery Act," he said, "we're able to take immediate action in communities like Las Vegas."

Donovan said funds invested in the neighborhood stabilization program and money Congress allocated last summer would give hard-hit areas similar to the one they toured "the tools to purchase and convert foreclosed and abandoned homes into affordable housing."

He said the rate of foreclosure filings in Nevada is more than seven times the national average. "But with foreclosure experts on the ground here in Las Vegas, pounding the pavement and reaching out to homeowners in crisis, I am confident that we can give hope to homeowners struggling to keep their homes."

Titus said the expansion of the Home Affordable Refinance Program would help thousands more people qualify, as the previous 105 percent cutoff was not high enough to help most Nevadans because their mortgages are so far underwater.

"Because of the decrease in housing prices coupled with the high unemployment rate, people in Nevada are hurting, and it will be a tremendous help to them and it's no fault of their own," Titus said. "They've been responsible, they've done the right thing, but they've lost jobs, or hours have been cut, and every new foreclosure just kind of bites to the bone."

Peggy Edwards, 62, has lived in the neighborhood for 18 years. She resides in the duplex next to the empty house, which she said has been abandoned for at least two years. The foreclosures, she said, have hurt the community. She said her street previously had five foreclosed houses and now has only two.

But she said the street still isn't the way she remembers it.

"It's very sad because when I moved here, it was just a pretty neighborhood, and everybody kept their yards up. It was friendly, and now I don't know a lot of (neighbors) because they come and go," she said.

For more information on the Home Affordable Refinance Program, visit makinghomeaffordable.gov or call 1-888-995-HOPE.

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