State receives $54.8m to combat foreclosures

HUD funding will also help cities fix abandoned homes

Massachusetts yesterday received $54.8 million in federal funds aimed at curbing the growing number of foreclosures, abandoned properties, and blight in struggling neighborhoods from Dorchester to Springfield.

The funding, coming from the US Department of Housing and Urban Development, includes $4.23 million for Boston, $2.57 million for Springfield, $2.39 million for Worcester, and $2.15 million for Brockton.

The Commonwealth received the largest portion, $43.47 million, which it will distribute to communities throughout the state.

"We want to make sure the bulk of the money is spent on acquiring and rehabilitating foreclosed property across the Commonwealth," said Tina Brooks, undersecretary of the Massachusetts Executive Office of Housing and Economic Development. "We need every penny of it."

State and community officials were expecting financial help, as part of a $3.92 billion housing stabilization fund passed by Congress this summer to help cities and neighborhoods particularly hard hit by the growing foreclosure crisis.

The number of foreclosures statewide has nearly doubled to 8,804 so far this year from 4,920 last year, according to real estate tracker Warren Group. There were 998 foreclosure deeds recorded in August alone.

"Foreclosure is a personal tragedy for families but also a disaster for neighborhoods," said Boston Mayor Thomas M. Menino.

"I want to put the money right into the neighborhoods to stop the bleeding."

Menino said the city will focus most of its funding in the hardest hit areas of Dorchester, Hyde Park, and Roxbury. The city plans to buy and rehabilitate foreclosed properties, and offer financial and technical assistance to new home buyers who want to live in these neighborhoods. The city already has purchased 12 units on foreclosure-ravaged Hendry Street in Dorchester for rehabilitation.

Government officials have 18 months to commit the new funds. Monies also can be used to help low- and moderate-income homebuyers cover down payments or closing costs, a HUD press release said.

To help explain details of the new program to local and state officials, HUD is planning regional conferences and a national housing summit in Washington, D.C., on Oct. 7-8.

"To those areas trying to recover from the effects of foreclosure and declining property values, help is on the way," said HUD Secretary Steve Preston. "Now the real work begins and HUD stands ready to support these states and communities as they work to stabilize their neighborhoods."

Jennifer McKim can be reached at jmckim@globe.com.