The House of Representatives voted Wednesday to end the Neighborhood Stabilization Program (NSP). The Neighborhood Stabilization Program (NSP) Termination Act (HR 861) cuts the last $1 billion of a federal program in which the government helps buy and develop foreclosed homes. The House also voted to postpone the vote on the Home Affordable Modification Program (HAMP) Termination Act (HR 839) until the week of March 28.
This is the third of the Obama Administrations anti-foreclosure programs to be terminated in the last week.
Rep. Gary Miller (R-Calif.) pointed out that grantees were found to be mishandling some of the funds in earlier rounds of NSP and that he would have supported a program that required the money to be paid back to the federal government.
"We did not stop a foreclosure," Miller said. "They do not have to pay it back. (Grantees) can sell those houses to whomever they want to as long as it is less than what they paid for it."
Rep. Barney Frank (D-Mass.) disagreed with Rep. Miller and said NSP is not a foreclosure prevention program but rather an initiative to clear out abandoned property with no known owner behind it.
"This is not only about foreclosed property. This is about foreclosed and abandoned property," Frank said. "There is a demonstrable amount of properties in these cities that cannot be traced. Somebody has to demolish property where there is no owner. Those bulldozers cost money. The person driving the bulldozer costs money."
The Department of Housing and Urban Development (HUD) released a statement after the bill was passed:
"The Neighborhood Stabilization Program is investing in hard-hit communities struggling to reverse the effects of the foreclosure crisis," the statement read. "Across the country, this program is already positively impacting property prices and turning houses that would be abandoned back into homes for American families. We cannot afford to turn back the progress we’ve made in these neighborhoods. To cut off funding just as this program is taking root would be counterproductive."
The Obama Administration has said the president will veto any bill ending any of his anti-foreclosure programs, and sources within the Senate said the legislation would not even be taken up.
Tags: NSP, HAMP, anti-foreclosure programs, HUD, abandoned property, American families, foreclosed property
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