Monday, January 3, 2011

Find Loans--and MAYBE Grants--To Fix Up Your Home

When thinking about where to find low-cost money for home fix-ups, think logically. If you have been reading this blog for any period or time, you know that nobody gives out free money for nothing (in fact, hardly anybody gives out free money, period). There is always something that a nonprofit group or government wants to happen as a result of giving away the money, or loaning it at below-market costs. So you have to think, what group wants my home fixed up? It's somebody who wants to have better housing stock within a particular area, or for a particular population group, or for a particular purpose, like making homes more energy efficient.  Here are the usual suspects:

1) City and state housing agencies. In cities large enough to have a housing or development department, there is usually a keen interest in keeping the housing stock safe and up to date. Often, the city is eligible for federal grants, which they use to create a pot of money to lend (at a lower cost than the banks) or create no-interest loans or even outright grants (usually reserved for the very poorest people). Contact them and ask if they have such a program. It will almost certainly be restricted by income, but the income levels might be higher than you think. It may be limited to particular neighborhoods, too. State housing authorities are another possible source of funding. While they always have home ownership programs, sometimes they have home loan programs, too.  This is a list of some of the local housing authorities, and all of the regional and state housing authorities. Remember that a local "housing authority" may merely be in charge of public housing, not private housing development (as is the case in Toledo, Ohio).  Call and ask if that's the case.  If so, try your local city government for possible programs.

3) State and local departments for the aged. These agencies may arrange loans or grants for repairs to senior’s homes. Here’s a site that will give you state and some local information.  Here's a site for a home repair program offered by the city of Detroit.

4) Community development corporations. These are nonprofit organizations created to improve some particular, defined area—a city, county, or part of one of those. If you live within a CDC area, you may be eligible for a loan or grant IF they have the money. Remember those federal grants I spoke of? They will give out the money till it’s gone. There is no nationwide directory of CDCs, but there is a directory by state.  The link for Ohio is dead, but I found a live one here.

5) IDA-giving organizations. These organizations create programs where they match your savings to create a pot of money that you can use for some defined purpose. Again, the availability depends on their resources, and if the source of their funds matches your need. They may only use funds for the purposes that they told the government they would use when they applied. And you will not immediately get the money—you must save over time. But it’s worth looking into.
6) Historic Home Funding--This website by the National Trust for Historic Preservation gives you some ideas of where to go if you primary residence is of historic value and needs preservation/rehabilitation work.  Also, see this list links for state and local sources.
7) The Department of Agriculture. They're not just about cows and crops, but rural development, too.  If you live in a rural area, and are very low income, you may be eligible for a loan or grant to rehabilitate your property.
8) Disabled veterans may be eligible for money to help purchase an accessible home or retrofit their current home.
9) A Community Action Agency. I’ve discussed these before. They are agencies set up to help the poor, and once again, you have to live within their service area. Check here to see if you live in a CAA. They may also provide free weatherization services if you have a low income.
10) HUD. While they don’t loan money, they do insure loans for home improvements. This could be worth considering if you have a hard time getting an affordable loan any other way.
10) If the improvements are meant to create energy savings, check this site to find energy incentives in your state.
11) Here's a couple of organizations that help low-income people fix their homes.

5 comments:

Allan Getter said...

Your income, credit rating and monthly expenditures serve as important factors in the HUD (Housing and Urban Development) loan qualification process. The down payment and the interest rate that you have to pay off will depend on these factors. Well, HUD is great; because they will really help you evaluate how much you can afford to spend on a home.

Brendan Amorose said...

Looking for funds for your historic home will not be a hard task, since there a lot of organizations out there that can help you fix, renovate, or with anything you want to do with your property. If you’re a private owner, your funding sources can be from local government agencies such as local preservations, historical societies and commissions.

Linda Koss said...

Brendan--
An excellent point. Thank you--many people overlook the local and private especially groups with an interest in historic preservation.

Selena Manchester said...

Yes, the Department of Agriculture really offers home loans. Well, it doesn't necessarily require that your home must be located in a rural area because there are even small towns around the US that meets the requirements of the USDA. Even if your home is located in one of the major cities, it can still be eligible for the USDA housing. You must just check their loan guidelines in order to make sure if you’re entitled to get a loan.

Linda Koss said...

Yes, you may in fact be more rural than you think. To see if you are "rural" under the rules of the Ag Department. Talk to your local Ag Department representative to find out: http://www.rurdev.usda.gov/StateOfficeAddresses.html