Mississippi is planning to use lenders to distribute grants of up to $150,000 to borrowers whose homes were damaged or destroyed by flooding in Hurricane Katrina.The Gulf Coast state is very close to filing an application with the U.S. government for $5.1 billion in Community Development Block Grants funds, of which $4 billion will be used to assist homeowners who lived outside a flood plain and had homeowners' insurance. The Mississippi Development Authority will make out a joint check to the homeowner and his or her mortgage company, which would provide drafts for construction and repairs, according to MDA spokesman Scott Hamilton. The amount of the assistance checks will be based on the insured value of the home, the amount of the damage, or $150,000, whichever is lowest. Homeowners who don't want to rebuild are also eligible for assistance.

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