San Joaquin Valley feels left behind on foreclosure aid

San Joaquin Valley lawmakers and homeowners still feel left out of the Obama administration's billion-dollar bids to ease the nation's foreclosure crisis.

The latest homeowner assistance program, unveiled with great fanfare, will spread $3 billion nationwide. But while California can expect at least $476 million of the total, the valley's share remains both ambiguous and a source of heartburn.

"I would call it a drop in the bucket, but it's probably less than that," said Rep. Dennis Cardoza, D-Merced.

Cardoza represents three cities -- Stockton, Modesto and Merced -- whose foreclosure rates consistently rank among the nation's highest. Add in Fresno and some smaller communities such as Los Banos, and the San Joaquin valley earns its title as ground zero for the housing bubble's bursting.

To help, Congress and the administration have opened up Uncle Sam's checkbook.

Most recently, the Treasury Department announced it will provide $2 billion nationwide for unemployed homeowners who need assistance paying their mortgage. The Department of Housing and Urban Development will provide an additional $1 billion in zero-interest loans for homeowners behind on their mortgage payments.

The latest programs follow others whose focus and efficacy skeptics question.

"Doing this is better than nothing," Cardoza said, "but I have not been impressed by the way HUD manages their programs. Their track record has not been impressive."

A recurring complaint is that the Northern San Joaquin Valley simply isn't getting its share.

Last year, the Neighborhood Stabilization Program provided $17 million to Fresno and Fresno County and $16 million to Modesto and Stanislaus County for the purchase of foreclosed, abandoned homes.

Merced, despite its comparably serious foreclosure problem, was not deemed eligible for one of the initial grants; eventually, Merced and Mer- ced County received $5 million distributed by the state.

No one yet knows exactly how the new assistance funds will be divvied up among local communities.

The new $1 billion HUD program will provide loans of up to $50,000 for homeowners who are at least three months delinquent in their mortgage payments. Officials announced Aug. 11 that the loans will assist those in "hard hit" areas, but they haven't yet defined "hard hit" nor decided specifically where the money will go.

"We're still determining how to target those funds," HUD spokesman Brian Sullivan said Thursday, adding that "we don't want to raise expectations about where those funds will be (spent)." The $2 billion Treasury program announced Aug. 11 expands an existing "Hardest Hit Fund." This will include $476 million for the California Housing Finance Agency, which has designed several mortgage assistance programs that can provide up to $50,000 for low- and moderate- income households.

Programs not ready until Nov. 1

The California assistance could range from mortgage payment subsidies to paying off delinquent loans. State officials, though, caution that the final programs won't be ready until Nov. 1.

Fresno's Martha Lucey, who runs ClearPoint Credit Counseling Solutions, said she hopes these newest offerings prove more effective than their predecessors.

"We have not seen the success needle move," said Lucey, whose agency helps troubled homeowners throughout the Northern San Joaquin Valley.

While Lucey acknowledged "a few thousand dollars can help a household stop a foreclosure," she stressed that any government aid will only prove temporary so long as homeowners are unemployed.