IIB 
110TH CONGRESS 
2D SESSION 
H. R. 5818 
IN THE SENATE OF THE UNITED STATES 
MAY 12, 2008 
Received; read twice and referred to the Committee on Banking, Housing, and 
Urban Affairs 
AN ACT 
To authorize the Secretary of Housing and Urban Develop-
ment to make loans to States to acquire foreclosed hous-
ing and to make grants to States for related costs. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
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SECTION 1. SHORT TITLE AND TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Neighborhood Stabilization Act of 2008’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title and table of contents. 
Sec. 2. Congressional purposes. 
Sec. 3. Loans and grants to States, metropolitan cities, and urban counties. 
Sec. 4. Qualified plans. 
Sec. 5. Allocation of amounts. 
Sec. 6. Loans. 
Sec. 7. Grants. 
Sec. 8. Eligible housing stimulus activities. 
Sec. 9. Shared appreciation agreement. 
Sec. 10. Spending requirements. 
Sec. 11. Servicer contact. 
Sec. 12. Accountability. 
Sec. 13. Definitions. 
Sec. 14. Funding. 
Sec. 15. Protection of right to bear arms. 
Sec. 16. Ineligiblity of illegal aliens for assistance. 
Sec. 17. Regulations and implementation. 
SEC. 2. CONGRESSIONAL PURPOSES. 
The purposes of this Act are— 
(1) to establish a loan and grant program ad-
ministered by the Department of Housing and 
Urban Development to help States, metropolitan cit-
ies, and urban counties preserve the equity and en-
sure the safety of the neighbors of homes made va-
cant by the predatory lending and foreclosure crises, 
to prevent and reduce the incidence of such vacan-
cies through various means, including purchasing 
and rehabilitating owner-vacated, foreclosed homes 
with the goal of stabilizing and occupying them as 
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soon as possible, either through resale or rental to 
qualified families; 
(2) to distribute these loans and grants to areas 
with the highest levels of foreclosure and delinquent 
subprime mortgages, and largest increases in the 
rate of vacant and abandoned single family homes; 
(3) to provide incentives for States, metropoli-
tan cities, and urban counties to use the funds to 
stabilize as many properties as possible; and 
(4) to provide housing for low- and moderate- 
income families, especially those that have lost 
homes to foreclosure. 
SEC. 3. LOANS AND GRANTS TO STATES, METROPOLITAN 
CITIES, AND URBAN COUNTIES. 
The Secretary of Housing and Urban Development 
shall, subject to the availability of amounts under section 
14, make grants under section 5(a) to qualified States and 
under subsections (f) and (g) of section 5 to qualified met-
ropolitan cities and qualified urban counties, respectively, 
and make loans under section 6 in accordance with the 
approved plans of qualified States, qualified metropolitan 
cities, and qualified urban counties, for use to carry out 
eligible housing stimulus activities under section 8. The 
program under this Act shall be administered through the 
Office of Community Planning and Development of the 
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Department of Housing and Urban Development or any 
successor office responsible for administering the commu-
nity development block grant program under title I of the 
Housing and Community Development Act of 1974 (42 
U.S.C. 5301 et seq.). 
SEC. 4. QUALIFIED PLANS. 
(a) IN GENERAL.—The Secretary may make a grant 
under this Act only to a State, metropolitan city, or urban 
county, and may allocate a loan authority amount under 
this Act only for a State, metropolitan city, or urban coun-
ty, that has submitted to the Secretary a plan that meets 
the requirements under this section and has been approved 
under this section. 
(b) CONTENTS.—A plan under this section for an al-
location recipient shall— 
(1) designate a housing finance agency of the 
allocation recipient, or other agency, department, or 
entity of the allocation recipient, or any other des-
ignee, as the allocation recipient administrator to act 
on behalf of the allocation recipient for purposes of 
this Act; 
(2) describe the housing stimulus activities 
under section 8 to be carried out with assistance 
under this Act for the allocation recipient by the en-
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tity identified pursuant to paragraph (1) of this sub-
section; 
(3) prioritize the allocation of funds to low- and 
moderate-income neighborhoods with high concentra-
tions of vacancies, according to the number of cen-
sus tracts, as determined by the Secretary, to have 
large increases in the rate of vacancy during the 
past eight quarters and significant levels of loans de-
termined to be at risk of foreclosure, and describe 
how such activities will help restore or improve the 
viability of such neighborhoods by providing for pur-
chase or occupancy of qualified foreclosed properties 
as soon as practicable and in a manner that will fa-
cilitate repayment of the loans provided under this 
Act for carrying out such activities; 
(4) set forth the procedures that the allocation 
recipient will use to allocate grant and loan amounts 
and monitor for compliance with the requirements of 
section 8; 
(5) provide that grant and loan amounts pro-
vided under this Act for the allocation recipient will 
be used only for eligible housing stimulus activities 
under section 8 that are eligible under such section 
for assistance with grant or loan amounts, as appli-
cable; 
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(6) contain such assurances as the Secretary 
shall require that the housing stimulus activities to 
be carried out with assistance under this Act shall 
not result in a significant net loss in rental housing 
in an area in which such activities are undertaken; 
(7) give priority emphasis and consideration to 
metropolitan areas, metropolitan cities, urban areas, 
rural areas, low- and moderate-income areas, census 
tracts and other areas having the greatest need, in-
cluding those— 
(A) with the greatest percentage of home 
foreclosures; 
(B) with the highest percentage of homes 
financed by subprime mortgage loans over 90 
days delinquent; or 
(C) identified by the State, qualified met-
ropolitan city, or unit of general local govern-
ment as likely to face a significant rise in the 
rate of home foreclosures; 
(8) notwithstanding any other preferences es-
tablished or authorized under this subsection, pro-
vide first priority, in use of amounts from grants or 
loans under this Act for rehabilitating housing, for 
providing housing for veterans, members of the 
Armed Forces on active duty, members of the Na-
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tional Guard or Armed Forces reserves, school 
teachers, and emergency responders; 
(9) provide preference for activities that serve 
the lowest income families, who otherwise meet the 
income requirements under section 8, for the longest 
period and homeowners, who otherwise meet such in-
come requirements, whose mortgages have been fore-
closed; 
(10) provide preference for use of grant and 
loan amounts in connection with acquisition of quali-
fied foreclosed properties that are acquired no ear-
lier than 60 days after the owner of the property de-
scribed in section 13(7)(B) acquired such ownership; 
(11) describe any other preferences the alloca-
tion recipient may establish, such as housing for 
first responders, for veterans, for nurses serving un-
derserved areas or homeless persons, or for homeless 
persons in accordance with the 10-year plan of the 
State to end homelessness, or providing housing for 
public school teachers or workforce who are em-
ployed by the city or locality in which the housing 
is located; 
(12) provide for obligation and outlay of grant 
amounts, and for loan commitments and disburse-
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