Sunday, September 12, 2010

Arizona gets $45 million for foreclosure crisis

On Wednesday afternoon, the Quinteros received one of their first housewarming gifts: a blue and green welcome mat for the front door of the family's new home.

U.S. Department of Housing and Urban Development Assistant Secretary Raphael Bostic, Phoenix Mayor Phil Gordon and others presented the gift after announcing that Arizona is receiving an additional $45 million to lift neighborhoods struggling through the foreclosure crisis and help more families like the Quinteros.

The state, three counties and eight cities were awarded the money through the federal government's Neighborhood Stabilization Program, aimed at reversing and preventing blight and abandonment from foreclosures. Phoenix received more than $16 million, the largest amount.

This is the third wave of NSP housing money from Uncle Sam. So far, Arizona has received more than $301 million, with more than $115 million going to Phoenix.

Local governments can use the money to buy, redevelop or raze foreclosed properties to fight blight and neighborhood deterioration that often occur when homes go into foreclosure. They can also use the money to provide loans that would prevent foreclosure or help qualified first-time homebuyers, like the Quinteros, with down-payment assistance.

In the living room of their new home in south Phoenix, Ignacio and Alma Susana Quintero talked about how it was a "miracle" for them to become homeowners. The family received $15,000 through NSP for the down payment on a $95,000, three-bedroom home that was previously foreclosed. Ignacio said the family wouldn't have been able buy the home without the down-payment assistance, which came from the first wave of federal housing money Phoenix received in 2009.

The family was living in an apartment, where rent was $1 less than the Quinteros' new monthly mortgage payment of $642.

It took three months for the Quinteros to close escrow on the home after applying for NSP funding. Ignacio, Alma and their 9-year-old son, Kevin, moved in Labor Day weekend.

"It was our dream to have our home," Ignacio said. "We thank God and we appreciate that we were able to do it so quickly."

Arizona and metropolitan Phoenix are among regions of the country hit hardest by the foreclosure crisis. Arizona ranks second to Nevada among states with the highest number of foreclosures, according to Realty Trac, which keeps an online database of bank-owned properties nationwide.

Bostic said NSP isn't a "silver bullet" that can address all of the nation's foreclosed properties, but the Quintero family shows that the program is working.

"This is a hard-working family, a middle-class family, that is just trying to get ahead in our society and our community, and it's a pleasure to see our resources and our program help out good people like this," Bostic said.

Foreclosed and vacant homes often have a negative impact on neighborhoods, creating blight, decay and reduced property values, Bostic said.

Among the country's 200 largest metropolitan areas, Phoenix ranks seventh in the number of foreclosures.

Phoenix received about $39.4 million in its first round of housing funding. In February, the city received an additional $60 million under the American Recovery and Reinvestment Act.

So far, 172 homebuyers have purchased homes in the city using federal NSP loans distributed by Phoenix. In addition, more than 120 foreclosed homes have been purchased by the city or partnering non-profit organizations for rehabilitation and resale.

City officials estimate that at least 1,500 houses and apartment properties in Phoenix will benefit from the first two waves of the federal housing money.

"It's about putting taxpayer dollars that have already been paid back into neighborhoods to protect the community," Gordon said.

And for at least one member of the Quintero family, it's about being happy in a new house with more space.

"I have my own room," Kevin said. "I have a lot of room to play."

by Lynh Bui The Arizona Republic Sept. 9, 2010 12:00 AM

Arizona gets $45 million for foreclosure crisis

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