Over 1,200 Fixed Miami Foreclosures for Low Income Families

Over 1,200 Miami foreclosures will be purchased, rehabilitated and rented out or sold to lower-income families by Miami-Dade-based nonprofits that comprise the consortium Neighborhood Housing Services of South Florida Inc., which received a total of $89.375 million from the U.S. Department Housing and Urban Development under the second allocation round of its second Neighborhood Stabilization Program.

Miami-Dade received the biggest share of the $348.31 million given to the state. The Florida division of Habitat for Humanity International got the second biggest share — $74.7 million. West Florida and Palm Beach County received $50 million each while Tampa, Lake Worth and Sarasota received $38 million, $23.24 million and $23 million, respectively.

Consortium director Arden Shank said the funds will be spent to fix 540 repossessed homes for eligible renters and 290 units for buyers. Around 425 rental units will also be built on vacant lots or on the sites of derelict buildings that need to be demolished. All of the housing units will be acquired or built in 73 neighborhoods with the highest percentages of abandoned and foreclosed properties.

The fixed Miami foreclosures will be sold at around $175,000 each to families earning not more than 120 percent of the county’s median income, which is around $81,000 for a four-member family. A certain number of units will also be sold to families earning the lowest incomes in the area. Under NSP rules, at least 25 percent of the NSP-funded units should be sold to households earning less than half of the area’s median earnings or about $33,000 for a four-member family.

According to Shank, the program will not only help families own homes, it will also rejuvenate neighborhoods from the bleak effects of abandoned residential foreclosures.

Based on a report released by the U.S. Treasury Department, a big portion of foreclosure filings still move on to foreclosure sales because the Home Affordable Modification Program has not been able to prevent home loss for many homeowners.

In the counties of Palm Beach, Miami-Dade and Broward, only 2,987 homeowners had their modified loans put into permanent modification status since the HAMP was launched. Statewide, only 8,405 mortgages were put into permanent modifications. Currently, about 96,703 mortgages in Florida are on trial loan modifications.

According to analysts, Miami foreclosures will continue to increase in 2010 because of the high unemployment rate and the continued drop in property values. They said that about 46 percent of mortgage borrowers in Miami-Dade, Palm Beach and Broward are underwater.

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