HOUSING REHABILITATION PROGRAM

Community Development Block Grant program (CDBG):

The CDBG program provides up to $25,000 for housing rehabilitation, also in the form of a deferred loan or a principal reduction for a PIP loan. The home is mortgaged and funds must be repaid in full when the property is sold, transferred or no longer occupied by borrower or death of borrower. Recipients will sign a mortgage and promissory note to the County of Saginaw for the amount of the deferred loan.

CDBG funds may also be packaged as a combination of deferred principle reduction loan and zero interest payable loan. This arrangement is available only as a last resort if all other loan sources turn down the applicant. The $25,000 limit for total CDBG funds will apply. Both loans require a mortgage.

A 100% Deferred loan only can be granted for households at or below 40% of the (AMI) Area Median Income (or 50% of AMI in the lowest income counties, whichever is greater). The graduated repayment scale is as follows:

50% AMI = 10% of total loan repayable monthly payments

60% AMI = 20% of total loan repayable monthly payments

70% AMI = 30% of total loan repayable monthly payments

80% AMI = 40% of total loan repayable monthly payments

Property Improvement Program (PIP):

The MSHDA Property Improvement Loan Program is designed to provide lower interest rate repayable loans for residential property improvements. These loans are originated by local participating community agencies and/or lenders and are purchased and serviced by MSHDA.

A borrower may make application directly to a participating lending institution. The lender originates the loan following the steps outlined in this guide and then forwards the loan to MSHDA for commitment. Loans are made available throughout the lending institution's normal lending territory.

An additional option allows the borrower to apply through Saginaw County. The County may also assist the lender in making loans by publicizing the program, screening applicants, and performing other tasks as mutually agreed upon. The lender makes the preliminary lending decision and forwards the loan package to MSHDA for commitment prior to closing.