Repair loans are second mortgages. This means borrowers don’t have to make any payments until they sell their home or refinance. There are special provisions that turn loans into grants for low-income disabled veterans and elderly homeowners.
“God bless them,” Cedeno said of CHN. “I don’t know what I would have done. There’s no way. How do you get another loan besides the loan you have? And pay more? Especially when it’s just me and the kids. “
The RCS sends a construction manager to assess each house for acute repair needs. Then, the nonprofit organization helps the owner solicit offers for the job. The loan money is paid directly to the contractor or contractors when the work is completed.
“They guided me through the process,” Cedeno said. “They don’t just leave you. They don’t just give you the loan. They also come to inspect. They make sure the job is done right.”
To date, the CHN program is helping 88 households. Asked about the unmet need, Greg Perelka, executive vice president of lending operations, laughed. “It’s endless,” he said.
Kevin Nowak, executive director of parent organization CHN Housing Partners, said he was discussing with government officials other potential sources of funding for home repairs. Housing groups are closely monitoring how local governments decide to spend money from the American Rescue Plan Act, the federal pandemic relief bill enacted in March.
Cuyahoga County is expected to receive $ 240 million over two years. Cleveland will receive just over $ 511 million. The first installment of money has arrived and local governments are preparing to submit preliminary spending plans to the Treasury Department by August 31.
Some of the money will be used to make up for lost government revenue. The remainder can be used, with some flexibility, to meet pandemic response needs or to address health and economic issues caused or exacerbated by the crisis.
In a presentation in May, the administration of Cleveland Mayor Frank Jackson included “critical home repairs” among the many difficulties the federal injection could solve. The city and county did not respond to requests for an interview on how home repairs fit into their spending priorities.
“Our county needs some pretty serious home repairs when it comes to a century-old housing stock. You just see the communities and homes are sort of deteriorating,” said Keesha Allen, executive director of the Home Repair Resource Center at Cleveland Heights. The association has tried to extend its program of long-term loans, for borrowers rejected by banks, to other communities.
Toni Jones, director of housing for the nonprofit Bellaire Puritas Development Corp. on the West Side of Cleveland, said there was a particular call for hands-on homeowner outreach and flexible funding. Many existing loan programs exclude applicants based on their credit scores, while grant programs limit the types of repairs – no garage maintenance or driveway work, for example – or require homeowners have insurance and are up to date on property taxes.
The ideal approach will combine public, philanthropic and private funds to support grants to people who cannot make payments and more versatile loans, including small-scale loans, to people who can, Nowak said.
“ARPA allows us, if we do it right, to have a capital base (…).
“It shouldn’t be a typical program,” he added.