Partnership tries to make dent in mortgage crisis

Hundreds of properties have been evaluated and purchased.

With nearly 30,000 foreclosures in Minnesota in 2008, non-profit organizations Greater Metropolitan Housing Corporation and the Family Housing Fund have been busy. Carolyn Olson, president of the Housing Corporation, talked progress at the Mortgage Crisis Panel, a discussion held at the Hubert H. Humphrey Institute of Public Affairs about the housing crisis Thursday. The partnership discussed the hundreds of properties theyâÄôve evaluated and purchased in the past few years, specifically citing the success in north Minneapolis, their main area of focus. The Family Housing Fund, created in 1980, and the Greater Metropolitan Housing Corporation, founded in 1970, both help lower-income families buy homes. The non-profits are working together in a pilot program with banks and the city to obtain and rehabilitate foreclosed properties. The banks give the partnership first look at the properties, allowing them a critical advantage. Subsidies are needed to cover the difference between rehabilitation and resale value. âÄúThere are no people doing what we are doing in the country,âÄù Olson said of the ongoing initiative. For a home to be considered, 70 to 80 percent of the value must be recovered in the home. Tom Fulton, head of the Family Housing Fund , said improved regulation and projects like this are vital in fixing the failing market. âÄúObviously, a fundamental premise is that without strategic intervention, this is not going to end well,âÄù Fulton said. âÄúItâÄôs going to be a huge challenge and it will really be a test of this state and its institutions to rise to the challenge and take advantage of opportunities.âÄù The state and the Family Housing Fund could also gain funding from the American Recovery and Reinvestment Act. Katie Lindblad, assistant commissioner of community development of the Minnesota Housing Finance Agency , said $28 million has been allocated for Minnesota. Funds received by the partnership would go toward expanding the area and number of homes purchased. âÄúThere are a lot of really good projects waiting to happen, waiting for investment,âÄù Lindblad said.