Single Family Rehabilitation Loan Program

DuPage County

0% Interest Loan / Deferred Loan

PROGRAM DESCRIPTION!

Single Family Rehabilitation Loan Program

DuPage County issues loans to qualified low and moderate income homeowners for housing rehabilitation under two rehabilitation loan programs which are outlined in this Program Description handbook. The two loan programs are 0% Interest or Deferred.
Below are questions and answers to help you understand how these programs work:
1. What is Housing Rehabilitation? Housing Rehabilitation is the process of repairing or replacing heating, plumbing or electrical systems and improving structural deficiencies that create substandard living conditions in a home.

2.

Where does the money for these programs come from? The housing rehabilitation fund is a grant to DuPage County by the United States Department of Housing and Urban Development under terms of the Housing and Community Development Act of 1974 as amended.

3.

Who operates the Community Development Commission? The Community Development Commission, a division of the Community Services Department, is an agency of DuPage County that is made of municipal representatives and County Board members.

4.

Who qualifies for Rehabilitation Assistance? Most residents of DuPage County, in a home he/she owns. (Fee Title-holder)

5.

Are there other qualifications?

Yes! Both programs are designed to assist low and moderate-income families; therefore, the applicants total household income cannot exceed 80% of median income for Chicago SMSA. (See income charts.) The after rehab value cannot exceed $275,200. The house can not be in foreclosure.

6.

Where do we apply to obtain a loan to fix our home? An application can be obtained from the Community Development Commission in the Community Services Department at 421 N. County Farm Road, Wheaton, Illinois or call (630) 407-6600.

7.

What kind of collateral do we need to qualify for a loan? A lien in the form of a mortgage & note will be recorded against the property to serve as collateral.

8.

What will the interest rate be on the loan? All loans will be made at 0% interest per annum. No interest is charged on deferred payment loans.

9.

Will the loan payments be made at your office? Yes. You will make the payments directly to the Community Development office on a monthly basis in person or by mail. Address: Community Development Commission, 421 N. County Farm Rd., Wheaton, IL 60187

10.

Who performs the rehabilitation work? Contractors registered with the Rehabilitation Office. There is no fee for registration. However, the contractor must carry the proper insurance and licenses applicable to his/her trade.

Read the following pages carefully. If you have additional questions, or would like to obtain an application, contact the Rehabilitation Office at (630) 407-6600.

0% INTEREST REHABILITATION LOAN

This program is designed to assist property owners in obtaining housing rehabilitation funds for projects where the cost of the project is beyond the property owners ability to pay.
The program will be limited to:
1. 2. 3. 4. Owner-occupied residences. No building containing more than four single-family residences qualifies. Loan maximum is $24,000. Applicants are not granted the entire loan maximum amount, only the amount needed to bring housing to current code and Housing Quality Standards. A maximum loan term of ten years. Activities are limited to the correction of code violations and substandard living conditions. Substandard living conditions are determined by HUD guidelines of Housing Quality Standards.

QUALIFICATIONS
To qualify for the 0% Loan, applicants must meet the following qualifications:
1. 2. Applicant must prove ownership of the residence being rehabilitated. You are considered an owner if you are a Fee Title-Holder. Applicant must reside in the residence being rehabilitated.

3.

Residence being rehabilitated must be located in DuPage County. (Note: Entitlement Communities are not serviced by DuPage County but are serviced by the Villages/Cities, themselves.)

4.

Applicants must have a total income, which does not exceed 80% of the median family income for Chicago SMSA as periodically established by HUD.
HUD Income Guidelines February 19, 2012
Household Size 1 2 3 4 5 6 7 8 or more 80% of MFI $ 42,500 $ 48,550 $ 54,600 $ 60,650 $ 65,550 $ 70,400 $ 75,250 $ 80,100

5. Gross income of all members of the household is considered to be part of the applicants income. However, when a member of the household pays rent to the homeowner, the rent amount will be counted as part of the household income instead of the renters gross income being counted. 6. Total liens on rehabilitated property must not be more than 85% of the total value of the rehabilitated property. The cost of the rehabilitation will be included in the 85%. A title search must be obtained on the property to be rehabilitated. Cost for the title search can be paid from the loan proceeds. If the loan can not be processed after the title information is received, the applicant is responsible for payment to the Title Company. After the loan is completed, subordinations will only be taken when the Home owner is refinancing in order to take advantage of a lower interest rate and will not receive cash. The after rehab value also can not exceed $275,200. The house can not be in foreclosure. Our guidelines only allow us to release funds on a property that has no mortgage, only one mortgage with no equity loan and/or no second mortgage, no Reverse mortgage, or no mortgage and only one equity loan. We will verify this through a title search on your property.

7.

8.

9. 10. 11.

DEFERRED REHABILITATION LOAN

The Rehabilitation Office considers Deferred Payment Loans to be an emergency measure designed to help only those persons who are totally unable to support the cost of rehabilitation by any other means. The loan must be used to address substandard living conditions and to correct code violations.
The program is limited to:
1. 2. Owner-occupied residences of most of DuPage County. No building containing more than four single-family residences qualifies. Loan maximum is $24,000. Applicants are not granted the entire loan maximum amount, only the amount needed to bring housing to current code and Housing Quality Standards. The applicant will not be required to make payments to reduce the indebtedness on the loan. The deferred loan need not be repaid unless title to the rehabilitated property is transferred. When the title is transferred, the full amount of the loan will be due and payable on the date of closing. No interest will be charged or accrued on the loan at any time.

3. 4.

5.

QUALIFICATIONS
To qualify for the Deferred Loan, applicants must meet the following qualifications:
1. 2. 3. Applicant must prove ownership of the residence being rehabilitated. You are considered an owner if you are Fee Title Holder. Applicant must reside in the residence being rehabilitated. Residence being rehabilitated must be located in DuPage County.

4.

Applicants must have a total household income which is not more than that shown in the following table:
HUD Income Guidelines February 19,2012
Household Size 1 2 3 4 5 6 7 8 or more 50 % of MFI $26,550 $30,350 $34,150 $37,900 $40,950 $44,000 $47,400 $50,050

5.

Gross income of all members of the household is considered to be part of the applicants income. However, when a member of the household pays rent to the homeowner, the rent amount will be counted as part of the household income instead of the renters total income being counted. Total liens on the rehabilitated property must not be more than 85% of the total value of the rehabilitated property. The cost of the rehabilitation will be included in the 85%. A title search must be obtained on the property to be rehabilitated by the program. Cost for the title can be paid from the loan proceeds. If the loan cannot be processed until after the title information is received, the applicant is responsible for payment to the title company.

6. 7.

8. After the loan is completed, subordinations will only be taken when the homeowner is
refinancing in order to take advantage of a lower interest rate and will not receive cash. 9. 10. 11. The after rehab value also can not exceed $275,200. The house can not be in foreclosure. Our guidelines only allow us to release funds on a property that has no mortgage, only one mortgage with no equity loan and/or no second mortgage, no Reverse mortgage or no mortgage and only one equity loan. We will verify this through a title search on your property.

ELIGIBLE REHABILITATION ACTIVITIES

Listed below are the categories of improvements eligible for the 0% Interest and Deferred Loan Programs.
1. Basic Structural Repairs
A. B. C. D. E. Exterior Walls Roof and roof structure Foundations Building room additions (if approved by the Rehab Office the number of occupants and square footage of the unit must not exceed the local building code requirements) Repair or install hard surface driveways (if approved by the Rehab Office cost can not be more than 30% of the total rehab cost)

2.

Appurtenances and Secondary Elements

A. B. C. D. E. Windows and window frames Doors and door frames Porches and stairs Interior walls, floors, and ceilings Sidewalks (if approved by the Rehab Office cost can not be more than 30% of the total rehab cost)

3.

Building Systems
A. Electrical 1. 2. B. Repairs Upgrading of service where appropriate

Plumbing 1. 2. Repairs Replacement

C.

Heating 1. 2. Repair or replacement of furnace and hot water heaters Installation of energy saving solar devices (if approved by the Rehab Office)

4.

Energy Conservation
A. B. Insulation Storm windows and doors

5.

Other
A. B. C. Installation of flooring (if approved by the Rehab Office) Demolition of structurally unsound buildings Repair of existing garage as long as repair cost is not more than 25% of the cost of garage replacement

Types of improvements not permitted:

A. B. C. D. E. F. New construction of secondary buildings such as sheds or garages Pools and pool liners Fireplaces Washers and dryers Interior painting Items covered by the homeowners insurance policy

Purely cosmetic or convenience improvements will not be allowed. This program is not to be used for modernizing or changing systems that are currently functional. All work to be performed must receive prior approval by the Rehab Office. ********

For more information, please contact the Housing Rehabilitation Office at 630-407-6600.