Our Work in Foreclosure Recovery
The foreclosure crisis has affected communities and neighborhoods on multiple fronts.Communities are confronted with thousands of vacant, foreclosed properties that depress property values and threaten to blight entire neighborhoods. Depressed property values have resulted in decreased tax revenue, forcing local and state governments to slice deep into their budgets and the social services that have provided safety nets to vulnerable families.
To address this complex problem, Enterprise has supported national and local strategies that incorporate collaboration, targeting and financing solutions.
National Impact
Innovation for Long-Term SolutionsAs the foreclosure crisis continues to reveal its breadth and depth, Enterprise is looking for solutions that innovate for long term, systemic change. Even as the overall demand for rental units increases, low income families are struggling to find affordable rental housing.
Thousands of single family properties stand vacant and represent an opportunity for affordable housing and a return to home ownership for those currently closed out of the market. Enterprise is engaging national and local partners to explore new models that provide true housing choice for all members of a community.
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Enterprise continues to chair the National Foreclosure Prevention and Neighborhood Stabilization Task Force, a cross-industry group of local and national organizations working to bring together advocates, practitioners, and other experts from across the country around foreclosure prevention and neighborhood stabilization efforts. The Task Force supports the exchange of critical information to help craft policy, legislative, and programmatic initiatives that primarily support low and moderate-income individuals and families.
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Strategies for addressing the massive foreclosed and vacant single family housing stock will be critical for long term community revitalization. Enterprise is exploring single family scattered site rental and lease/purchase models for replicability and scale.
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Low-, moderate-, and middle-income communities are being locked out of returning to home ownership by obstacles to mortgage financing. Enterprise’s research is identifying solutions for sustainable affordable mortgage financing.
- Mortgage Resolution Fund (MRF): Enterprise, in partnership with Mercy Housing, the National Community Stabilization Trust, and the Housing Partnership Network, has created MRF to purchase distressed mortgage notes using Federal Hardest Hit Funds and modify the mortgages to keep the homeowners in their homes. MRF has begun operations in Illinois and hopes to expand to between 3 to 5 additional states in 2012.
Neighborhood Stabilization Program
Enterprise worked closely with affordable housing stakeholders to raise awareness of the foreclosure crisis and its devastating impact on neighborhoods. The Housing and Economic Recovery Act (HERA) of 2008 (H.R. 3221) was signed into law on July 30, 2008, and included the Neighborhood Stabilization Program (NSP) which received $3.92 billion in emergency funds. Enterprise worked closely with HUD, the House Financial Services Committee and the Senate Banking Committee to develop and refine regulations governing the NSP program.
Enterprise was one of several key leaders in securing an additional $2 billion for a second round of NSP funds in the American Recovery and Reinvestment Act (ARRA) of 2009 to support states, localities and nonprofits. In 2010, Congress allocated an additional $1 billion for NSP3 in the Dodd-Frank Wall Street Reform and Consumer Protection Act.
National Community Stabilization Trust
To address the challenges local governments, nonprofits and mission-driven for-profit entities face trying to access bank Real Estate Owned (REO) properties in their communities, Enterprise formed the National Community Stabilization Trust (Stabilization Trust) in partnership with:
- NeighborWorks America
- Housing Partnership Network
- Local Initiatives Support Corporation
- National Council of La Raza
- National Urban League
Local Impact
CollaborativesEnterprise has been an active participant in national collaborations, and has supported local collaboratives as a strategy for addressing the unique complexities of foreclosure response and community revitalization. Examples include:
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Piece By Piece Regional Foreclosure Initiative: A partnership of 140 organizations in the 10-county metro Atlanta area, Piece By Piece provides up-to-date status of Metro Atlanta’s foreclosure crisis and ways to take action to help address it, offers opportunities for coordination and best practice sharing; and encourages public commitments on three to five year goals that will be taken to address the crisis.
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East Bay Collaborative: A partnership of nonprofits and local governments located in the San Francisco East Bay Region that focuses on best practice sharing and developing shared capacity. A joint marketing program and online sales platform was developed that serves all East Bay NSP programs increasing the number volume of interested homebuyers purchasing rehabilitated properties.
- Opportunity Homes: Enterprise and its partners started Opportunity Homes in six Cleveland neighborhoods so that development partners can purchase and rehab blighted properties, and make them available for sale to low-income buyers.
The strategic use of capacity building grants is helping local community development corporations expand their ability to respond to the challenges and opportunities created by the foreclosure crisis on the ground. Examples include:
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Neighborhood Housing Services of South Florida: Received funding to support its Brownsville Redevelopment Initiative which provides homebuying education & homeownership preservation counseling, development of new and rehabbed single-family homes for affordable home ownership, and community development activities.
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Greater Rochester Housing Partnership (GRHP): Received funding to prepare a cost study to refine and expand the HOME Rochester program that has acquired, rehabilitated and sold over 550 foreclosed properties over 10 years. The study identified hidden operating costs and allowed GRHP to develop an appropriate business plan to expand HOME Rochester.
- Restore Neighborhoods Los Angeles (RNLA): Enterprise and the city of Los Angeles partnered to create RNLA, a community-based development organization that will acquire bank real estate owned (REO) properties and rehabilitate them into affordable housing.