President Barack Obama has announced a new housing fund which would be given to five states. The total corpus involved is $1.5 billion which would be spilt amongst these states based on their demands and requirements. The five states in question are- Michigan, Arizona, California, Florida and Nevada.

They are the ones that have been the hardest hit by the recent foreclosures during the financial recession. They have seen the house prices fall by as much as 20 per cent. Out of the list, Michigan is the least hurt.

The money has been allotted to stop the number of foreclosures being filed. The money will be given to the unemployed homeowners, who would then be able to pay to the banks. It would also help the struggling borrowers.

Just a year back, Obama had declared a $75 billion Home Affordable Modification Program, to solve the same problem. A research shows that it has helped only 116,000 homeowners across US. Another 830,000 are still under trial.

The current amount will come from the $700 billion Troubled Assets Relief Program (TARP), which too has faced its share of critics.