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Homeowner Rehab/Repair Program

Purpose of the Program:

The intent of the program is to provide “gap” financing for rehab or repair services to existing homeowners in Oceana County.

Program Components of Housing Repair and Rehabilitation:

Moderate Rehabilitation                                                                         

·   Total project costs of more than $10,000.

·   County program expenses capped at $10,000 with a minimum of $1,000.

·   County funds secured by a deferred loan - no interest, no payments while the principal residence. Loans exceeding $2,500 require a second mortgage.

·   Consumers must provide at least ½ of total project costs.

·   Project must address health, safety or environmental concerns (heating, electrical, plumbing, weatherization, structural deficiencies), accessibility needs (wheel chair ramp, wheel chair accessible cabinets or fixtures, etc.) overcrowding, and/or functional obsolescence. Landscaping, siding or similar appearance upgrades may be approved if part of a larger project addressing previously listed concerns and/or necessary to protect the assisted property.

Minor Rehabilitation                      

·   Total project costs do not exceed $10,000.

·   County program expenses capped at $5,000 with a minimum of $1,000.

·   County funds secured by a deferred loan - no interest, no payments while the principal residence. Loans exceeding $2,500 require a second mortgage.

·   Consumers must provide at least 1/3 of total project costs.

·   Projects must address the same targets listed above for moderate rehab projects.

Emergency Repairs:

·   Total project costs must not exceed $2,500.

·   County program expenses capped at $2,500 with a minimum of $1,000.

·   No deferred loan or second mortgage required.

·   Projects must address immediate health or safety concerns resulting from unanticipated system failures or unintentional damage not covered by warranties or insurance. “Emergencies” required simply because routine maintenance or repair needs have been ignored will not generally be funded under this component.

Eligibility Requirements for Applicants:

·   Applicant must live in Oceana County.

·   Project must be principle residence ( 8 months continuous residence during a 12-month period).

·   Applicant must provide proof of ownership.

·   Applicant must not have a current County Program lien against the property.

·   Applicant for Moderate Rehab/Repair component and Minor Rehab/Repair component must be eligible for financing of the required share of project costs.

·   Applicant must not own other real estate unless it earns a share of reported income.

·   Liquid assets of more than $10,000 must be used to meet the owner’s share of project costs. Other assets not customary for household use will be treated as additional income from investment.

·   Gross monthly income from all sources must be sufficient to support the anticipated housing debt as defined under Debt Limits below.

·   Gross monthly income must not exceed 80% of area median income adjusted for family size as listed below (numbers subject to change without notice).

Debt Limits:

·   Housing debt (PITI = Principal + Interest + Taxes + Insurance) will vary depending on the current mortgage and the cost of proposed construction or repair, but must not exceed 33% of the owner’s income.

·   Total debt (above + child support + car loan + credit card + other installment debt) must not exceed 42% of gross monthly income.

Property to be Rehabbed:

·   Must be located in Oceana County.

·   No Moderate or Minor Rehab investments will be made in Manufactured Homes, Mobile Homes, or trailers as defined by USDA Rural Development.

·   Replacement of existing housing units will not be covered by this program. Alternate funding sources for replacement housing may be available on a case-by-case basis.

·   Property taxes must be current.

·   Property must be insured with a homeowner’s policy at a level sufficient to protect program investments.

·   The property must not be in default on a current mortgage or land contract.

·   Where a land contract exists, the land contract must be recorded, and the owner of the land contract must agree to subordinate the contract to any second mortgage required to secure county funds or must sign the second mortgage.

·   The property must be free of refuse or debris or the removal of same must be covered in the project plan.

·   Rehab work plan must address the following in order of priority:

à         Health, safety or environmental concerns.

à         Overcrowding/functional obsolescence.

à         Landscaping, siding or similar appearance upgrades may be approved where such work is part of a larger project addressing the above priorities and/or otherwise necessary to protect the assisted property.

·    The after rehab value of the assisted property must not exceed 85% of the maximum HUD FHA Section 203 B loan for single family homes in effect at the time the project is undertaken.

 ·    The total of all liens that will be in place on the assisted property at project completion must not exceed the after rehab value of the property.

Available Support Services:

·   Help in negotiating the loan process including, if needed, preparing an application and assembling the needed documentation.

·   Assist in the selection of the most favorable loan product.

·   Home finance education, Financial Management Workshops, and individual credit and budget counseling services for consumers unable to obtain financing.

·   Basic Homeowner Maintenance training.

The Application/Selection Process:

·    Applicants will be required to complete a MSHDA Household Profile to initially apply for services.

·    Applicants, with the exception of those served under the “Emergency Repairs”, will be on a “first-qualified, first served” basis. First-qualified will be determined by successful application for any required financing.

·    Applicants for the Emergency Repairs will be served on a “first-come” basis.

·    All project plans must be approved by OHP staff for funds to be committed.

Minimum Rehab / Repair Standards:

·    All work will comply with local building codes and will be conducted in a workman-like manner.

·    Upon completion of any Emergency Repair project the assisted repairs must meet Section 8 Housing Quality Standards (HQS) or local codes, whichever is more stringent.

·    Upon completion of any Housing Repair and Rehabilitation project the assisted property must meet Section 8 Housing Quality Standards (HQS) or local codes, whichever is more stringent.

Source of Funds for this Program:

Funding for this program provided by Oceana County with support of the Michigan State Housing Development Authority (MSHDA). Homeowner financing available from USDA Rural Development (RD), Federal Home Loan Bank of Indianapolis (FHLBI), MSHDA Property Improvement Program (PIP), and Local Lenders.

This brochure is intended as an informational summary only. Additional rules and requirements apply and are updated periodically. Current and complete guidelines are available on request from OHP and will be reviewed at the time your application is processed.