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Federal homes rescue plan is changed

DADE CITY — A foreclosure rescue plan designed to help some Pasco families buy up empty homes — and drum up a little business for the sagging real estate industry — had to be revamped after federal officials criticized it.

The feds earmarked $19.5-million in emergency housing assistance back in September to help Pasco County, one of the hardest-hit counties in the state by foreclosures. The county planned to use most of the money to provide down payment assistance loans of up to $15,000 to help lower-income families buy homes.

But on Wednesday, community development director George Romagnoli told the County Commission that feedback from banks and U.S. Housing and Urban Development officials was bad. The agency and banks wanted the money to go toward fixing up the abandoned homes — some of which are old — to resist hurricanes and meet the current codes before they are resold.

So the county will rewrite its plan to use $10-million of the grant to allow nonprofit agencies to buy and rehabilitate homes. The amount set aside for down payment loans will be cut to $6.5-million.

West Pasco Board of Realtors president Greg Armstrong urged commissioners to keep most of the money in homebuyer loans to help a broader array of distressed properties. But county officials said they risked losing the grant if the federal agency rejected their proposal.

"The most important thing is we get the money," Commission Chairman Ted Schrader said.

Final approval of the plan is expected Nov. 25. Money could start being used in January, but it must be spent within 18 months.

David DeCamp can be reached at ddecamp@sptimes.com or (727) 869-6232.

Federal homes rescue plan is changed 11/05/08 [Last modified: Wednesday, November 12, 2008 4:32pm]
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