; and (B) experience in developing housing for homeless veterans. (3) Selection Priority (A) Communities with greatest need Subject to subparagraph (B), in accordance with regulations the Secretary shall prescribe, the Secretary shall give priority in the awarding of grants under subsection (b)(1) to eligible entities who serve communities that the Secretary determines have the greatest need of homeless services. (B) Geographic Distribution The Secretary may give priority in the awarding of grants under subsection (b)(1) to achieve a fair distribution, as determined by the Secretary, among homeless veterans in different geographical regions. (C) Other agreements In awarding a grant under subsection (b)(1) to an eligible entity in a location determined pursuant to subparagraphs (A) and (B), the Secretary shall give preference to eligible entities that are entered into an agreement with the Secretary under section 2041 of title 38, United States Code. (e) Use of grant funds (1) Purposes A grantee may use amounts of a grant awarded to the grantee under subsection (b)(1) to purchase or renovate abandoned homes, including homes that have been foreclosed. (2) Maximum purchase amount The Secretary shall establish maximum amounts, based on geography, for grants awarded under subsection (b)(1) that may be used for the purchase of a single home. (3) Payment program (A) The United States shall not have any ownership interest in a home that is purchased by a grantee using amounts of a grant awarded under subsection (b)(1). (B) Each grantee shall ensure that, beginning one year after the date on which a veteran begins to reside in a home purchased or renovated by the grantee using a grant awarded under subsection (b)(1), the veteran makes monthly payments to the grantee in an amount determined appropriate by the grantee that is not less than 85 percent of the fair market rent for such home. (C) Each grantee shall determine whether payments made by a veteran under subparagraph (B) shall be treated as rent or as a mortgage for