The U.S. Department of Housing and Urban Development is launching a first of its kind agreement with the nation’s largest mortgage lenders to give selected state and local governments and non-profit organizations priority over individual investors to buy foreclosed properties.

Communities and organizations receiving government funding under HUD’s Neighborhood Stabilization Program will be given a first right of refusal to purchase bank-owned properties in certain neighborhoods. The goal of the program is to rehabilitate, rent, re-sell or demolish these homes.

HUD’s NSP grantees,”often find themselves competing with private investors for real estate-owned (REO) properties, which can hinder their efforts to stabilize neighborhoods with high foreclosure activity,” notes the HUD release.

“This agreement helps us level the playing field to give communities a better chance to stabilize these neighborhoods,” says HUD Secretary Shaun Donovan.