Have you heard about MSHDA’s Property Improvement Program? This program offers low interest home improvement loans to single-family homeowners with low-to-moderate income, and landlords renting to low-to-moderate income tenants. Eligible home improvements include repairing or replacing a roof, installing new siding, adding insulation, replacing a furnace, installing a ramp, remodeling a kitchen, and other similar improvements. With energy costs continuing to rise, this program is an affordable way to make improvements that will increase energy efficiency and reduce utility bills over the long term.
Homeowners can borrow up to $50,000. MSHDA does not require equity in the home for loans $25,000 and under, making it the ideal product for a new homeowner or existing homeowner with limited equity. Because we can amortize the loan up to 20 years, the monthly payments are very affordable for those on a fixed income. The interest rate for homeowners is 4%, 6%, or 8%, depending upon income.
Landlords can borrow up to $25,000 per unit, with a maximum outstanding limit of $100,000 per borrower. Eligible properties cannot have more than 24 units. The interest rate is fixed at 8%. There are no income requirements for landlords, but the rental units must meet MSHDA rental limit guidelines.
These loans are provided through MSHDA-approved participating lenders and community agents. For participating lenders, these loans provide a product that can bring new customers to their business. While the lender works directly with the borrower to underwrite the loan, MSHDA purchases the loan and assumes the financial debt and loan servicing. Further, MSHDA pays the lender up to $400 per loan. Our current participating lenders tell us that many of the PIP customers return to the bank, open checking or savings accounts and apply for other loan products. The goodwill established when offering a PIP loan can continue beyond the loan process.
For realtors, these loans may be just the product to close the deal. We do not require equity in the home for loans $25,000 and under, making it the ideal product for a homeowner. Because we can amortize the loan for 20 years, we can keep the payments affordable.
If you are interested in more details, you can visit web site at www.michigan.gov/mshda, then click on the Home Improvement link.