How to Get an 1% Interest Rate on Your Home Repair Loan

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How would you improve your home if you had $150,000 to spend? Homeowners know one thing for sure – with homeownership comes home maintenance and repair. For many Alameda County homeowners, though, the financial strain of making important repairs and improvements means putting them off for months or even years. And with some current home improvement loan rates topping 35%, it leaves quite a few of the area’s homeowners unable to afford the work – and instead, living in conditions that threaten their health, safety, or comfort. But some of Alameda County’s homeowners have found a solution that brings home improvement and repairs within reach: Renew Alameda County.

How Renew Alameda County Makes Home Repairs Affordable

Renew Alameda County (Renew AC) is a government home repair loan program tailor-made for homeowners with modest incomes. With loan terms designed for maximum affordability, Renew AC makes it possible for homeowners to make the repairs that keep them in their homes, offer them comfort and peace of mind, and enable them to thrive.

Renew AC can help make your home repair plans become a reality without breaking the bank through:

• A 1% Interest Rate: Unlike many home improvement loans, Renew AC loans have a 1% interest rate so that qualifying families can make needed repairs without an excessive financial burden.
• An Interest Cap: Renew AC’s 1% interest rate accrues annually, but total interest is capped to never exceed 50% of the principal amount borrowed.
• Payment Deferment Options: Renew AC loans do not require payments for a term of 30 years or until the home is sold. At the end of the 30-year Loan Term, the loan may be extended for an additional 30-year period, so long as you’re not in default of any of the initial qualifying program requirements or terms.
• Low and High Loan Amounts: Depending on types of repairs, homeowners may receive a loan between $15,000 and $150,000. This means a whole range of projects, large and small – from roofing, seismic work, and electrical work, to flooring replacement, bathroom upgrades, and installation of ramps – qualify for a home repair loan.

Types of Home Improvements

When your home needs critical repairs like lead abatement or a new roof, repairs can be a matter of life and death. Ramps and handrails might make the difference for a homeowner’s mobility, one that lets them age in place safely. Correcting code violations can protect homeowners from potential displacement. One way or another, for many homeowners, repairs and improvements are the key to holding onto a beloved home, while preserving health, safety, and comfort.

“We serve many retired homeowners who find they can’t keep up with deferred maintenance, like a new roof, on their social security checks,” says Laura Salcido, the Resource Development Manager at Habitat for Humanity East Bay/Silicon Valley – the organization who operates Renew AC.

In the Bay Area specifically, many families are looking for ways to create healthy, decent, livable space for multi-generational households, and they’re turning to Renew AC for repairs that correct code violations and make it possible for a their grandkids or a caretaker to move in.

For a project to qualify to be covered under a Renew AC loan, repairs commonly fit into three broad groups:

• Structural Rehabilitation:
  • system-wide/structure-wide rehabilitation improvements
  • re-roofing and gutter replacement
  • seismic strengthening, foundation repairs, and other structural issues
  • exterior wall restoration and exterior painting
  • energy efficiency improvements, solar
  • electrical and plumbing system improvements
• Health & Safety Hazards:
  • correction of health and safety hazards or developing or current code violations
  • carpentry needs such as replacement of broken stairs
  • replacement of unsafe flooring
  • kitchen and bath health and safety improvements
  • lead-based paint hazard remediation
  • property drainage improvements
• Accessibility:
  • conversion of bathtubs to accessible shower units
  • widened doorways
  • ramp installation
  • replacing doorknobs with lever handle knobs, adding handrails, etc.

Who Qualifies for Renew AC’s Home Repair Financial Assistance

To qualify for a home repair loan with Renew AC, homeowners must apply and provide documentation that shows:

• You own and live in a home in Alameda County
• Have an annual income of not exceeding 80% of the Area Median Income
• Have no more than $150,000 in assets
• You meet credit requirement focusing on the security of your home
• Have a loan-to-value ratio of no more than 90%, including the Renew AC loan

3 Steps to apply to the Renew AC Program

Since Renew AC is administered by Habitat for Humanity, applicants will work directly with Habitat staff throughout all aspects of your home improvement process – from filling out your application documentation, to walking you through loan processing and permitting, and through providing end-to-end construction management. Unlike a typical bank loan, with Renew AC you get professional technical assistance throughout the entire construction process.

Here are your first steps to making your home repair dreams a reality with a home improvement loan through Renew AC:

• Visit RenewAC.org to learn more about the program, see if you qualify, and if your home repair needs will be covered by the Renew AC loan.
• Complete a Request for Service through the website or by mail.
• Work directly with a Habitat staff member to confirm your qualifications, review required documents, and continue to the application.

Renew AC is the result of funds set aside from Alameda County’s 2016 Measure A1 housing bond, so while it is a County-funded project, the program is currently administered by Habitat for Humanity East Bay/Silicon Valley. To learn more, visit www.RenewAC.org or call Habitat for Humanity’s Home Preservation Hotline at (510) 803-3388.

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