No-interest Home Repair Loans for Detroit Homeowners

March 24th, 2015
Visit http://www.detroithomeloans.org for more information

Mayor Mike Duggan announced today the Detroit 0% Interest Home Repair Loan Program. It provides $8 million in financing for eligible homeowners looking to replace or patch roofs, replace windows, upgrade plumbing, make electrical repairs, replace the furnace, and address structural or safety issues.
This program is an unprecedented opportunity and we encourage all eligible homeowners to apply.

Southwest Solutions is one of the nonprofit partners in the program serving as an Intake Center to help eligible homeowners complete the intake forms and start the loan application process. Our Intake Center is at the offices of Southwest Economic Solutions at 2835 Bagley, Suite. 800, Detroit, MI 48216. Intake forms can be downloaded on the City’s website devoted to the Home Repair Program.

The program is directed at Detroit homeowners earning up to 80 percent of the area median income ($54,150 for a family of four), as well as households in designated areas of the city (regardless of their income), including almost all of southwest Detroit. The program is designed to help homeowners fix deteriorating properties and help eliminate blight.

Loans are available between $5,000 and $25,000 for Detroit homeowners who own and occupy single-family homes. Homeowners who own properties with two units, such as duplexes, can be eligible for up to $50,000 as long as they live in one of the units. Loans are paid back over ten years. There is no fee for paying back a loan early. Homeowners pay back only what they borrow.

The aim of the program is to help Detroit homeowners who have stayed in the city to invest in their homes and neighborhoods. To qualify for a loan, the homeowner must have occupied the home for at least 6 months.

“This program creates a permanent source of funds to rehab houses for those people who hung in with us,” Mayor Duggan said. “It will generate a wave of home improvement work across the city that will raise property values and strengthen neighborhoods.”

The program is a city-led partnership with Housing and Urban Development (HUD), the Local Initiatives Support Corp. (LISC), and Bank of America. It helps fill a growing market gap — owners who want to invest in their homes but can’t get affordable traditional financing because property values have eroded their ability to borrow.

Funding for the program comes from $4 million of Community Development Block Grant funds from HUD, as well as $4 million from Bank of America. LISC will use the funding to provide loans to qualified homeowners. As homeowners pay back the loans, they will improve their credit history, while also building a track record of loan performance that will encourage others to lend and invest in these communities.

“We see this partnership as a way to support homeowners with resources that will improve their lives and be instrumental in sustaining the economic vitality of our city.” said Matt Elliott, Michigan market president, Bank of America.

“The impact of this program will go well beyond the walls of the houses it helps repair,” said Michael Rubinger, LISC president and CEO. “We are building a case for investing in homes, businesses, schools and parks in Detroit neighborhoods — even in places that might appear too risky for conventional financing models.”

A dozen nonprofit agencies in the city will serve as Intake Centers for the program. They are: Bridging Communities; Central Detroit Christian CDC; Cody Rouge Community Action Alliance; Detroit Non-Profit Housing Corp.; Goodwill Industries of Greater Detroit; Jefferson East, Inc.; New Hope Community Development; Operation ABLE; SER Metro Detroit; Southwest Solutions; U SNAP BAC; and Wayne Metro Community Action Agency.

“The use of long-standing local partners as Intake Centers allows homeowners to work with organizations they are already familiar with,” said Tahirih Zeigler, executive director of LISC’s Detroit program. “This new product for financing home repair will support existing residents to stabilize their neighborhoods and make Detroit more attractive to new residents and businesses.”

If you are interested in applying for a no-interest home repair loan, please contact Southwest Economic Solutions at 313-841-9641. We encourage you to download the application (or pick one up from our office), fill it out and assemble the required documents, and then contact us to schedule an appointment to review the application and submit it on your behalf.

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