This program is called the Heirs' Property Family Wealth Protection Fund.

"Without the proper legal process, there are often roadblocks preventing equity from being passed down as property owners intend," said FHLBank Atlanta President and CEO Kirk Malmberg, in a press release. "As part of our work to address housing and homeownership challenges, FHLBank Atlanta has focused on heirs' property issues, which occur when a property owner passes away without a will designating a successor owner or the heirs fail to properly vest title to the property in their names."

Its original effort followed a December 2021 forum that invited nonprofit organizations to pitch pilot programs to the FHLBank Atlanta and other groups including the FHLBank Dallas (which has its own program), to help deal with heirs' property, also known as tangled titles.

In these situations, after the original owner dies, typically without a will, multiple family members across several generations, have a stake in the property. But in many cases, the current occupants do not appear on the deed.

Federal legislation has been introduced to encourage additional states to adopt the Uniform Partition of Heirs Property Act; as of 2022, it had been approved in some form by 22 states. Even though two related bills were introduced in April in the House of Representatives, neither has advanced so far.

The FHLBank Atlanta's funding for the 2022 program was limited to the organizations that made pitches. The Heirs' Property Prevention and Resolution Grant Initiative provided the $1 million in funds to 24 forum participants.

This new effort starts on Oct. 1 and has an application deadline of Oct. 31. It is open to community organizations, tribal entities, governments and municipalities who can apply for up to $500,000 in grant funding to assist property owners located in low-to-moderate income areas in the FHLBank Atlanta district, which is made up of Alabama, District of Columbia, Florida, Georgia, Maryland, North Carolina, South Carolina and Virginia.

A Harris Poll survey conducted for the FHLBank Atlanta found roughly one in five homeowner respondents did not have or were not sure whether they have either a clear title (22%) or recorded deed (20%).

While 90% of those surveyed in this nationwide poll expected the equity and wealth they built up through homeownership to benefit their heirs when they die, 43% did not have a will or estate plan.

Heirs' property problems tend to be more prevalent in lower income communities.

The FHLBank Atlanta survey indicated that 57% of homeowners with an annual household income under $50,000 do not have a will or estate plan. Furthermore 42% of that group are planning to leave their home to multiple heirs, exacerbating the potential risk of a tangled title.

Besides the FHLBanks in Atlanta and Dallas programs, Rebuilding Together, which has gotten funding from the Wells Fargo Foundation, has outreach efforts in Philadelphia; Baton Rouge, Louisiana; and Kent County, Maryland.

The American Land Title Association has also been working with families impacted by this situation.

A primary reason why these families come to Rebuilding Together Philadelphia and similar groups is because they want to make repairs to the home but the tangled title issue makes that difficult.

"When ownership of a property is unclear, it hinders the accumulation of generational wealth and makes it hard for the home to be maintained or sold, often leading to neighborhood blight," said Tomeka Strickland, FHLBank Atlanta senior vice president and director of community investment services Tomeka Strickland. "The Family Wealth Protection Fund was created to help individuals protect their hard-earned assets for future generations while strengthening communities."

In New York, a budget bill passed in July that criminalized deed theft, also included provisions regarding the handling of heirs' property.

"Heirs Property Protection and Deed Theft Prevention Act of 2024," which was folded into the larger resolution, puts into effect a ban on the partition of heirs' property.

Besides the repair issues, bill supporters cited the likelihood of disputes among family members if such a property were to be sold that puts current occupants in peril and also it might be vulnerable to a tax foreclosure.

"No partition action related to an heirs property may be initiated by a party that purchased or otherwise acquired their share or shares by means other than inheritance, and who did not inherit their share or shares directly from a person who was a co-tenant prior to the property becoming heirs property or from a co-tenant who was an heir thereto," the added section of New York State law reads.