Shaun Donovan, HUD secretary

The U.S. government’s settlement against five big banks was supposed to benefit distressed homeowners, but many states cannot resist diverting the funds to make-up for budget shortfalls, the New York Times reported. When the government reached the estimated $25 billion settlement with banks over mortgage and foreclosure abuses, $2.5 billion was earmarked for states to prevent foreclosures, investigate fraud and alleviate general housing market woes. Now, 15 states have announced that they will be budgeting the money for items other than housing — although 27 states have agreed to use their entire distribution as intended. [more]

Following their conviction for defrauding elderly homeowners, three South Florida mortgage loan officers have been banned from government business by the U.S. Department of Housing and Urban Development, the Sun Sentinel reported. Each of the three, along with a Pittsburgh-based title agent, pleaded guilty to conspiracy to commit wire fraud. “HUD will not tolerate those who abuse the mortgage system and target elderly borrowers for their own personal gain,” said Shaun Donovan, HUD Secretary. [Sun Sentinel]

The United States’ 1.2 million public housing units need an estimated $25.6 billion for large-scale repairs, according to a study released by the Department of Housing and Urban Development. “The new capital needs estimate far exceeds our annual budget for these repairs and illustrates why America needs a long-term strategy to address the loss of thousands of public housing units annually,” said HUD Secretary Shaun Donovan. “Many of the nation’s public housing units are buckling under a severe backlog in capital needs.” The report focuses on improvements required to make the housing “decent and economically sustainable,” such as replacing roofs, updating plumbing or improving electrical systems to increase energy efficiency. — Alexander Britell

Department of Housing and Urban Development Secretary Shaun Donovan responded to a recent report by Harvard Joint Center for Housing Studies today on CNBC. The report shows that one in every four U.S. households is paying more than half their income on rent and middle-income Americans are struggling just as badly as those in a low-income bracket. Rents are rising, vacancies are falling and buyers simply can’t get credit, the report revealed.

Asked about helping the rental housing market and pushing homeownership, Donovan says, in the video above, that HUD didn’t have the luxury of prioritizing one over the other. “We’ve had the biggest increase in worst-case rental housing needs over a two-year period, 2007 to 2009,” he said, “in the history of looking at those numbers.”
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The Department of Housing and Urban Development will release $1 billion in mortgage assistance to the unemployed this spring, after receiving complaints from lawmakers and advocacy groups that HUD was stalling in their efforts. More than 60 national consumer advocacy groups called on HUD to implement a program that would pay up to $50,000 per eligible borrower, Housingwire reported. The HUD money comes with a 0 percent interest rate and seeks to help homeowners with mortgage payments for up to 24 months. To qualify for the federal funds, borrowers must show they have either lost their job or suffer from a medical condition. Also, a household’s yearly income cannot exceed 120 percent of the area’s median income, and the income must have been reduced by at least 15 percent over the last two years. HUD announced the program in August, but earlier this month, Sen. Bob Casey sent a letter to HUD Secretary Shaun Donovan, urging him to disburse the funds he claims were overdue. “This foreclosure crisis is too severe for such a slow pace of implementation,” advocates said in a Jan. 21 letter sent to Donovan. A spokesperson for HUD said homeowners should be able to apply for the program sometime during the first quarter of 2011. [Housingwire]

A joint program from U.S. Housing and Urban Development and Health and Human Services will help nearly 1,000 non-elderly Americans with disabilities leave nursing homes or other facilities to live independently, the agencies announced today. HUD is providing $7.5 million in rental assistance vouchers to help these individuals rent private apartments. Those receiving rental assistance through the program will also receive health and social supports — from HHS’ Centers for Medicare and Medicaid’s “Money Follows the Person” grant program — that will enable them to live independently. TRD 2 Comments

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The Obama Administration has allocated $73 million for housing counseling, the Department of Housing and Urban Development announced today, aimed at helping families find suitable and affordable homes while avoiding foreclosure. The funds will be given to more than 500 different home counseling programs across the country. HUD Secretary Shaun Donovan said that the organizations receiving the funds “assist families in making more informed choices before they purchase a home and counsel families facing foreclosure.” The $73 million funding marks a 22 percent increase over last year’s allocation of $60 million. TRD

HUD Secretary Shaun Donovan

The Department of Housing and Urban Development announced today the allocation of $35 million for new the development of early childhood and adult education facilities. The federal funding will allow public housing authorities nationwide to construct, purchase or rehabilitate facilities for educational use, such as job training and childhood development programs. Local housing authorities must apply for funds by Jan. 14, 2011, and the maximum grant available is $5 million. TRD

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Shaun Donovan

The U.S. Department of Housing and Urban Development unveiled a program today aimed at helping communities badly hit by the foreclosure crisis avoid sweeping vulture investors. The “National First Look Program” will offer select state and local governments a right of first refusal on foreclosed homes, before they’re made available to private buyers. The benefit of this, said HUD Secretary Shaun Donovan, is that it may help communities preserve buildings and put them to use based on the area’s specific needs. “Local communities will now get an exclusive option to buy foreclosed properties in targeted neighborhoods so they can turn the homes into affordable housing or, in some cases, tear them down,” Donovan said. This “will help rebuild neighborhoods that have been struggling with blight and declining home values due to foreclosures.” TRD

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