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Oct 7, 2008 9:29 pm US/Eastern
Pembroke Pines Gets Federal Foreclosure Help Money
PEMBROKE PINES (CBS4) ―
The federal government is sending billions of dollars to cities across the country to help fight foreclosures, but a South Florida leader says the money will not get to the root of the problem.
The city of Pembroke Pines recently received a letter from the Department of Housing and Urban Development promising the federal government is sending more than $4 million dollars to them to deal with foreclosures.
But one city commissioner says the plan prevents cities from putting money directly into the hands of homeowners.
Foreclosures in Broward County are skyrocketing, with more than 35 thousand foreclosure actions on homes and commercial property this year. Miami Dade has also seen more than 35 thousand foreclosures. Cities such as Pembroke Pines were waiting for money from the federal government to help.
"While any dollars to help deal with the foreclosure crisis are welcome, this isn't quite what we had hoped for," said Pines City Commissioner Angelo Castillo.
Castillo is grateful for the $4.4 million in funding from HUD, but he says there are strings attached, and the money cannot be given directly to homeowners to help pay their mortgages.
"What we have is a plan that just basically allows us to buy foreclosed properties that have already been foreclosed," said Castillo. "Those families are gone and now they want us to go into the rental or resale business."
Castillo says the money turns cities into landlords. The cities can use the money to buy foreclosed homes, tear them down or fix them up. In all, HUD is handing out nearly $4 billion nationwide through their program.
The money should be available after December first, but Castillo believes the money would be better spent helping struggling homeowners get current on their mortgages so they can keep their homes.
"I'm a little disappointed that it was more targeted to the people that need the money the most. In our view, that's the families."
The city also wanted to explore using these funds to build affordable housing. That is also not allowed. They have asked HUD for a waiver but they've already been told these rules are set.
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