Abandoned and broken down houses sit next to well-maintained family homes in Atlanta's Pittsburgh community. It's a legacy of a mortgage fraud crisis that left vacant nearly half the homes in the neighborhood. Pittsburgh homeowners, Invest Atlanta, the Annie E. Casey Foundation and Wells Fargo are working on a program to revitalize Pittsburgh, which was ravaged by mortgage fraud, foreclosures and blight that followed. Photo by J. Scott Trubey/STAFF strubey@ajc.com. Monday, March 2, 2015.
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Feds to audit foreclosure aid program in several Atlanta-area counties

Feds to audit foreclosure aid program in several Atlanta-area counties

Abandoned and broken down houses sit next to well-maintained family homes in Atlanta's Pittsburgh community. It's a legacy of a mortgage fraud crisis that left vacant nearly half the homes in the neighborhood. Pittsburgh homeowners, Invest Atlanta, the Annie E. Casey Foundation and Wells Fargo are working on a program to revitalize Pittsburgh, which was ravaged by mortgage fraud, foreclosures and blight that followed. Photo by J. Scott Trubey/STAFF strubey@ajc.com. Monday, March 2, 2015.
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Feds to audit foreclosure aid program in several Atlanta-area counties

Abandoned and broken down houses sit next to well-maintained family homes in Atlanta’s Pittsburgh community in 2015. It’s a legacy of a mortgage fraud crisis that left vacant nearly half the homes in the neighborhood. Photo by J. Scott Trubey/STAFF strubey@ajc.com.

A watchdog arm of the Treasury Department announced plans to audit the implementation of a federal program created to aid homeowners struggling with their mortgages in Georgia, with an eye toward determining whether minority neighborhoods have been properly served.

The federal watchdog said it will hone in on three Atlanta-area counties — DeKalb, Fulton and Clayton — to determine whether the HomeSafe Georgia program “has adequately served those most in need of this assistance in selected counties, including homeowners in minority neighborhoods.” The Special Inspector General for the Troubled Asset Relief Program said it also plans to examine work conducted by the Treasury Department, Georgia’s Department of Community Affairs, contractors and other local entities in the hopes of finding areas for improvement.

There have long been questions about whether the nation’s housing recovery has left behind African-Americans, including in many of Atlanta’s neighborhoods. The HomeSafe Georgia program in particular has seen its share of criticism in recent years.

The program is the local iteration of the Hardest Hit Fund, which was created as part of Congress’ Troubled Asset Relief Program, or TARP, to help unemployed homeowners avoid foreclosure. Georgia was awarded $340 million for the program in 2011, and the state vowed to help more than 18,000 Georgians. But a watchdog report two years ago found that several years into the program the state had spent only a quarter of that money to help about 5,900 Georgians, less than one-third of their target.

U.S. Rep. John Lewis, D-Atlanta, requested the federal audit six weeks ago and has raised concerns that HomeSafe Georgia is underperforming compared to other states. He’s also warned about overly strict eligibility criteria and sub-par outreach to the people who could benefit most from the program.

“If there is a racial disparity in housing recovery, I feel we owe it to our community to learn everything we can about shortcomings in the programs designed to address the foreclosure crisis and corresponding home values,” Lewis wrote in an Aug. 1 letter to the feds.

Lewis praised news of the audit in a statement Tuesday.

“Every day, every second, and every cent matters to thousands of people who are desperately trying to hold onto the American dream of homeownership,” he said.

MaryBrown Sandys, a spokeswoman for the Georgia Department of Community Affairs, said the office has not yet been notified of the audit but is ready and willing to cooperate.

“At DCA, we recognize that many metro Atlanta counties have experienced some of the greatest need for economic assistance in recent years and we continue to work hand in hand with these communities to address housing and other issues,” Sandys said.

Data from the TARP watchdog’s quarterly report concludes that Georgia has the fourth lowest admission rate nationwide for its Hardest Hit program. It also reported that more than one-in-four applications to the program in Georgia were withdrawn, the fifth highest withdrawal rate among the 18 states and the District of Columbia that are involved with the Hardest Hit Fund.

Read More: 

Metro housing rebound leaving areas behind

Georgia lags in foreclosure help

Mortgage assistance program slow to start

Foreclosure aid made easier in HomeSafe program


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