Neighborhood Stabilization Program

Abstract

Neighborhood Stabilization Program was implemented to cope with the rapid increase in mortgage foreclosures which brought negative impacts to residential areas. NSP was intended to remove abandoned and unsafe houses, provide rehabbed properties to homebuyers, and send positive signals about future expectations of residential areas. Major features are 1) NSP was implemented as a part of existing program, 2) NSP1 allocated financial resources to all the states but NSP2 and 3 did selective, 3) NSP2 and 3 applied risk score to choose target areas, 4) NSP2 was allocated in a competitive manner and to not only to states/counties/cities but also public entities/NPOs, and 5) national objective requirements were set to each eligible activity. Although NSP generated certain positive results, states with many tax foreclosures still needs huge financial resources to stabilize neighborhood.