There are new programs, backed by federal funds, to help people buy foreclosure homes across metropolitan Phoenix.

Money for the programs, which include downpayment and closing costs assistance, is coming from the $121 million in Neighborhood Stabilization funds Arizona is receiving. The money must go towards helping the state’s neighborhoods hardest hit by foreclosure, and most of those areas are in the Valley. There are state, county and city programs to help people purchase homes taken back by lenders. Go to the Arizona Department of Housing’s new Web site YourWayHomeAZ.com to see if you qualify.

Neighborhood Stabilization programs are being offered by Arizona, Maricopa and Pima counties and the cities of Avondale, Chandler, Glendale, Mesa, Phoenix, Surprise and Tucson. Information on most of the programs is on the website. In some cases, buyers could qualify for more than one program.

Most cities are offering qualifying buyers help in purchasing and even renovating foreclosure homes. The city of Phoenix is offering eligible buyers as much as $15,000 in downpayment and closing costs. Phoenix received the biggest share of the federal funds, $39.5 million.

The state of Arizona is using more than half of the $38 million it is getting to help people with down payments on foreclosure homes. Borrowers, who earn 120 percent or less of an area’s average median income, are eligible.

Arizona’s Neighborhood Stabilization funding was approved last December, but the money wasn’t available until last month. Not all of the programs are fully operational yet, but prospective buyers can put their names on waiting lists. Most programs require homebuyer counseling.

Also, watch out for company Web sites with similar names that ask for money.
All information on the state’s Web site is free, said Donald Cardon, who took over as director of the housing department in March. He said the Neighborhood Stabilization programs will help some people afford homes who couldn’t just a year ago.

The YourWayHomeAz will be updated as new programs are available. Neighborhood Stabilization funds must all be spent by 2011. One concern is that in some of the neighborhoods the supply of foreclosure home is falling as more investors purchase the properties. The recent drop in Valley foreclosures could also impact the programs.