Source: Market Place
The Treasury Department has changed the rules on the Hardest Hit
Fund, a program meant to help people hit by the housing crisis stay in
their homes, allowing states to use some money from the $7.6 billion
foreclosure prevention program to demolish homes instead.
...
Michigan and Ohio have changed their contracts with the Treasury
Department so they can use foreclosure prevention funds for home
demolition. Michigan has diverted a $100 million into demolition. That’s
a fifth of its money from the Hardest Hit program, part of the Troubled
Asset Relief Program, or TARP. The money will be used to tear down
7,000 vacant homes.
“Here we were assisting homeowners to stay in their homes, but then,
many of these communities had so many blighted properties that
homeowners would throw their arms up and say, ‘I’m never gonna get value
out of this house, why am I doing this?’” says Mary Townley, director
of homeownership at the Michigan State Housing Development Authority.
Michigan officials say blight leads to abandonment. It invites crime
and drives down property values in neighborhoods where the 13,000
homeowners they’ve already helped are trying to hold on. They say
demolishing derelict homes isforeclosure prevention.
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