What is “NSP” and why is it important to the Wisconsin Neighborhood Advantage?
The Neighborhood Stabilization Program (NSP) was created as part of the federal Housing and Economic Recovery Act (HERA) signed into law on July 31, 2008. NSP is a $4 billion community program designed to address an increase in foreclosed and vacant single family properties. As the administrator of NSP funds, HUD identified the Wisconsin Department of Commerce as the direct grantee for the state. As a sub-grantee, WHEDA was awarded NSP funds for the creation of an acquisition-rehabilitation loan for foreclosed homes. In addition to funding mortgages, NSP funds under Wisconsin Neighborhood Advantage will also provide down payment and closing cost assistance to low income borrowers. The Wisconsin Neighborhood Advantage is unique in that it leveraged a private investment to create a mortgage financing program. WHEDA’s unique creation of a loan loss reserve, paired with private dollars, represents an 8:1 leverage ratio – three times what other NSP programs have been able to leverage.
