Government to Spend Faster on Failed Programs
As of March 16, only 38% of the grant money from the Neighborhood Stabilization Program (NSP) had been “obligated,” meaning a municipality has a formal contract at a specific address in place. More than 300 local governments have barely made a dent in their funds, according to a recent U.S. Department of Housing and Urban Development report. Some communities have used their money to buy, renovate and resell homes to low- and moderate-income families. Others demolished eyesores or bought multifamily apartment buildings and rented them out. Some used non-profits to manage the program. But governments must commit the money to projects by September or it’s gone, and local officials say they’ve been stymied by the rules, overwhelmed by starting a new program and, in many cases, outbid by cash investors when trying to buy foreclosures. Read more 
New Treasury Home Short Sales Rules
foreclosure - short sales
The new rules were issued under the Treasury Department’s Home Affordable Foreclosure Alternatives Program (HAFA). Under the modified HAFA rules, the short sale process is streamlines and standardized at a national level, including uniform documentation and costs
- Lenders are required to answer a request for a short sale within 10 business days of receiving the purchase offer.
- Homeowners also get $1,500 in cash as a “relocation incentive” to cover moving costs, deducted from the sale price.
- Mortgage lenders, in turn, receive $1,000 to help cover and speed up the process of the sale.
The new HAFA short sale rules don’t take effect until April 2010. The new rules will offer significant assistance to homeowners in trouble when they take effect, particularly in the realm of whether or not a homeowner who has completed a short sale owes any dept in the property.