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Jim Rice is braced for the worst.

Rice runs Northland Neighborhoods, a nonprofit organization that provides services to residents throughout Clay and Platte counties. And these days, like a sailor seeing a red horizon in the morning, he’s preparing for an impending storm of home foreclosures that is starting to overwhelm some of the area’s most vulnerable neighborhoods.

"We’ve been trying to convince the city of Kansas City that we’ve got a huge problem up here, too," he said. "It’s frustrating."

According to the most recent figures released by the real estate data firm RealtyTrac, the home mortgage and foreclosure crisis that started in 2007 has hit Clay County harder than any other county in Missouri.

The county saw one foreclosure for every 343 homes in November, 2008, RealtyTrac reported. That was the highest rate in the state, and significantly higher than similar counties like Platte, Cass, Jackson, Boone and St. Charles (see infographic).

RealtyTrac’s report backs up data released last year by the federal Department of Housing and Urban Development, which show large swaths of the Northland with high rates of foreclosures, high-cost mortgages, unemployment and home abandonment risk.

Neighborhoods around Winnetonka High School, Pleasant Valley and Liberty have been particularly hard hit, according to HUD maps.

Clay County’s leading position for home foreclosures in Missouri was news, but not surprising to Rice.

"This is the case that we’ve been trying to make for years," he said. "We want to do everything we can to help people from losing their homes."

At this point, though, it appears that the Northland is largely on its own when it comes to getting government help to face down the foreclosure storm. Why? The area’s hard hit neighborhoods are in slightly better condition than communities south of the Missouri River.

In September, HUD Secretary Steve Preston announced a nearly $4 billion community development block grant program to help states and municipalities save drowning homeowners. It’s called the Neighborhood Stabilization Program and was authorized by the Economic Recovery Act of 2008.

"Clearly, the intent is to put this money to work in communities with the highest need and to have a meaningful impact," Preston said in a press release.

Kansas City, with a 5.4 percent foreclosure rate for the 18 months up to June of last year, got $7.3 million of federal grant money administered through Missouri’s Department of Economic Development.

The city had to submit to HUD a spending proposal for the Neighborhood Stabilization Program funds, which are supposed to benefit residents whose household income is 120 percent of the region’s median. A quarter of the money has to be used to buy and redevelop abandoned or foreclosed properties, and other approved uses include establishing land banks and demolishing blighted structures.

Kansas City housing official Shirley Winn is in charge of the city’s Neighborhood Stabilization Program.

In her proposal to HUD, Winn focused on those areas that are in the most critical condition. On a city map with red marking the worst neighborhoods, there’s a long, wide contusion with a perfect storm of unemployment, bad loans and abandoned homes.

Those are the areas that will get city assistance if the proposal is approved by HUD, Winn said. See Q & A for more information.

Kansas City North, where things are bad but not as bad, will get nothing.

Rice acknowledged that Kansas City North was in better overall shape than the rest of the city. He’s still worried, though, particularly about unethical speculators with no long-term interest in the Northland buying up cheap property.

"It looks pretty grim to me," Rice said. "We might not have even hit bottom, yet."

 STEPS FOR AVOIDING FORECLOSURE

Homeowners who are in financial trouble have a variety of options to explore before they face foreclosure, according to the U.S. Department of Housing and Urban Development.

The most important thing is to admit the reality of the situation, do the homework and seek help before the situation becomes an emergency. The worst response is to ignore the problem and avoid contact with the mortgage holder.

More information about all these steps can be found on HUD’s foreclosure Web site: www.hud.gov/foreclosure.

- Meet with a housing counselor — the Kansas City area has several HUD-sponsored agencies that offer advice to homeowners who are facing foreclosure, including Acorn Housing, Catholic Charities of Kansas City-St. Joseph and Legal Aid of Western Missouri.

- Work with the lender — Mortgage holders, like homeowners, would rather avoid foreclosure, so they’re often willing to negotiate a payment plan that allows avoids that option.

- Use state programs — Missouri has a number of state government programs to assist struggling homeowners, including a help for veterans with delinquent mortgages.

- Prioritize spending and use assets — Troubled homeowners should take an honest look at what they spend and adjust their budgets accordingly. Also, difficult decisions may have to be made about selling a car, cashing in nonliquid assets, getting a second job or renting room in the home in order to avoid foreclosure. In the long run, these things will pay off.

- Avoid scams — Never, under any circumstances, sign a document from a company claiming to help the homeowner avoid foreclosure without first checking with a HUD-sponsored counselor. Also, don’t use fee-based services.

Source: U.S. Department of Housing and Urban Development

Q & A about Kansas City’s Neighborhood Stabilization Program

None of the city’s Northland neighborhoods will get any of the block grant money under the city’s proposal submitted to the U.S. Department of Housing and Urban Development. How likely is it that that situation will change?

The Housing and Economic Recovery Act, and the corresponding HUD regulations, are specific to providing emergency federal assistance to areas with the greatest percentage of foreclosed and abandoned homes, highest percentage of homes financed by subprime mortgages, and areas of greatest need identified by the local government. In Kansas City, we have an estimated 4,600 properties in either foreclosure or bank ownership. The data shows that the highest percentage of impacting properties are in neighborhoods with a high incidence of low income households, high number of vacant lots, a weak market for homeownership, and a high degree of properties with code violations.

Do you feel like the Northland is being slighted or given "the short end of the stick?"

Since 1993 the Northland area from North Kansas City to Vivion Road has benefitted, perhaps more than any other area, from the city’s HOME 2nd Mortgage Program, which allows first-time home buyers to afford conventional mortgages. This program has sustained an active housing market in those low and moderate income neighborhoods.

What hope for support or assistance would you offer to struggling home owners in Northland neighborhoods that fall slightly short of the grant requirements?

Northland Neighborhoods has provided minor home repair programs and consistent community development services to sustain the strength of its neighborhoods. The combination of these types of programs should and will continue.

How would you characterize the housing and foreclosure situation in Kansas City right now?

We have great housing challenges in our established neighborhoods, and financial issues in all sectors of the city. However, we are not ravaged by foreclosures as much as some other cities. The only way to turn this situation around is to aggressively acquire, rehabilitate and sell properties. The Neighborhood Stabilization Program allows us to start the process.

How optimistic are you that the Neighborhood Stabilization Program will have the desired impact? How long will it take for the Neighborhood Stabilization Program to have an impact?

The Neighborhood Stabilization Program funds will allow the city to initially acquire, rehab and sell 200 homes and land-bank 50 properties. That’s only five percent of the known number of foreclosed and abandoned homes. We will work closely with neighborhood-based community development corporations and associations to strategically identify areas of both greatest need and opportunity for success. The Neighborhood Stabilization Program is a five-year program, and as homes sell we will address additional properties.

Are you satisfied with the amount of Neighborhood Stabilization Program funds allocated by the state to Kansas City? Why or why not? If not, how much does the city need to get the job done?

The federal Neighborhood Stabilization Program allocation to states and cities is based on a HUD formula which takes into account population, age of housing and income. Neighborhood Stabilization Program funds from the state are based on need. We will continue to work with the state to show that there is a need in Kansas City. The first step is to show that we can address the need by successfully implementing our Neighborhood Stabilization Program.

Staff writer Ray Weikal can be reached at 389-6637 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

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