NJCC Selected to Buy 399 Distressed Loans Through HUD Program

New Jersey Community Capital (NJCC) was selected as part of HUD’s Distressed Asset Stabilization Program (DASP) to purchase 399 troubled loans, the nonprofit announced Tuesday.

Out of the 399 loans purchased by NJCC, 150 of the mortgage holders are located in Essex County, New Jersey and another 249 in Tampa Bay, Florida.

The purchase was made as part of the Neighborhood Stabilization Outcome (NSO) component of DASP. Loans purchased from the NSO pools include sale terms requiring efforts to promote neighborhood stabilization in select hard-hit communities.

NJCC plans to bring stability to the communities where the loans are located through ReStart, a home preservation program designed to address the mortgage delinquency problem of homeowners.

Since many of the mortgages for the properties have two or more units, NJCC says ReStart can potentially save homes for more than 600 families.

NJCC said it “will work with each homeowner to develop individualized mortgage repayment plans, with the goal of maintaining ownership for as many people as possible.”

As another goal, NJCC says it hopes to create a model that can be replicated in other cities to prevent foreclosures.

The nonprofit was provided with about $78 million in funds to purchase the loans through its partnerships with Prudential Financial, MetLife, and Newport Capital Bancorp.

In addition, NJCC announced it closed a seven-year, $2 million Program-Related Investment (PRI) from the Annie E. Casey Foundation.

Out of the $2 million, $1.5 million will go toward capitalizing NJCC’s Neighborhood Prosperity Fund (NPF) and the remaining $500,000 will be used for the Community Asset Preservation Corporation (CAPC) for property acquisition.

“These strategies will also serve as important models of effective tools for the revitalization of underserved communities suffering from abandoned and vacant properties,” NJCC stated in a release.

In mid-November, NJCC also announced it became a member of the Housing Partnership Network, a peer network of accomplished affordable housing nonprofits.

By: Esther Cho, DSNews.com