Allocated under the recently passed Dodd-Frank regulatory reform bill, the money will be used by states and counties to acquire, redevelop or demolish foreclosed properties. (No breakdown on where the money is going was provided.)
A HUD spokesman noted that this round of government funding will not be used for providing mortgage assistance to struggling borrowers. However, the cash can be used for downpayment assistance for new homeowners that want to buy foreclosed homes.
Previously, the government has provided almost $6 billion in foreclosure-related assistance.
HUD's effort is known as the Neighborhood Stabilization Program, or NSP.
"These grants will support local efforts to reverse the effects these foreclosed properties have on their surrounding neighborhoods," said HUD secretary Shaun Donovan. "We want to make certain that we target these funds to those places with especially high foreclosure activity so we can help turn the tide in our battle against abandonment and blight."
