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Ford Foundation Funds Foreclosure Buys

The ""Ford Foundation"":http://www.fordfound.org/ has committed $50 million to a new nonprofit venture to help municipalities purchase banks' foreclosed homes. According to the ""_Wall Street Journal_"":http://www.wsjonline.com, the investment is one of the largest made by a foundation to help alleviate the effects of the housing crisis.
The funding will go to the ""National Community Stabilization Trust"":http://www.stabilizationtrust.com, a consortium of community-based nonprofits that will serve as a go-between for cities and communities trying to rehabilitate neighborhoods and mortgage servicers looking to unload distressed properties.
The consortium will work with state and local governments, as well as other groups that have received grants from HUD to rehabilitate foreclosed homes, and will attempt to simplify and accelerate the acquisition process.
The _Wall Street Journal_ says the consortium is courting financial institutions such as J.P. Morgan, Bank of America Corp., and GMAC Financial Service, to negotiate discounted prices on seized homes before the properties are listed for sale to the public.
The trust's goal is to spur purchases in more than a hundred cities by year's end and help stem the decline in property values plaguing the many neighborhoods and communities that have been hit hard by the foreclosure crisis.
The Chicago-based ""MacArthur Foundation"":http://www.macfound.org is also contributing $3 million to the effort. The awards from Ford will come in the form of a 10-year loan with a below-market interest rate of 1 percent. The trust said it hopes the investment will attract additional private capital, and is set on raising a full $400 million to be used for the purchase of distressed residential assets.
The Ford Foundation is a private organization chartered in 1936 by members of the Ford family and executives of the Ford Motor Company. The foundation is based in New York City and funds programs for scientific and educational advancement, to support the public welfare, and to help strengthen the country's economic system.