About The Program
The City of Taft Rehabilitation Loan Program provides low-interest and deferred-payment loans to low and moderate income homeowners for home repairs. Loans are available for rehabilitation of residential property only. Repairs include roofing, termite work, plumbing, electrical, flooring, heating/cooling, painting and some general property improvements. Improvements such as pools, spas, garages, fences, landscaping and interior decorating are ineligible. Energy conservation improvements such as weather stripping and insulation are encouraged.
Basic Eligibility Requirements
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1.
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The property to be rehabilitated can be owner-occupied or tenant-occupied. |
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2.
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Occupant income – gross income must be at or less than: |
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Family
Size
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Annual
Income
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Monthly
Income
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1
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$25,400
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$2,117
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2
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$29,050
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$2,421
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3
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$32,700
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$2,725
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4
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$36,300
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$3,025
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5
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$39,250
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$3,271
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6
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$42,150
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$3,513
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7
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$45,050
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$3,754
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8
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$47,950
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$3,996
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March 2003 – Subject to change.
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3.
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A period of affordability will be determined by the total dollars used for the Rehab. A Rent Restriction is based on the HUD formula at the time the loan is made, based on the number of bedrooms. |
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4.
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The property must be within the city limits, in the designated Target Area and zoned residential. |
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5.
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All lead based paint hazards must be abated. |
Loan Highlights
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1.
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There are three (3) types of loans:
- Deferred Payment Loan (DPL) No monthly payments. The loan is deferred until transfer of title, w/o interest, for an Owner Occupant.
- Below Market Interest Rate (BMIR) The Interest Rate for BMIR loans is fixed at 5%, for an Owner-Investor.
- 50% DPL – 50 % BMIR @ 5%
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2.
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Any loan requiring payments is amortized for 15 years. |
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3.
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There are some Grants available for elderly or disabled homeowners. |
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4.
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Maximum Loan - $25,000 ($45,000 for extreme need). The amount of loan depends upon the level of work needed and available owner equity. |
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5.
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Total debt on the property, including the rehabilitation loan, may not exceed 95% of value for an Owner-Occupant and 90% for an Owner-Investor. |
How To Apply
Contact the City of Taft Housing Coordinator to determine your eligibility. If you are eligible, you will be mailed an application.
The application process is similar to a bank loan.Verifications will be made of your income, savings and existing mortgage to qualify you for a loan. If you qualify, your property will be inspected and the process begins.
There is no charge to apply for a loan. All loan costs, such as title insurance, recording fees, termite report, etc., are included in the loan amount. Loan papers will be signed after construction proposals are submitted and after the loan is approved by the City loan committee.
Loans are secured by a Promissory Note and a Deed of Trust recorded on the property.
The borrower must maintain fire insurance coverage and keep property taxes current.
Inspection, Bidding and Contracts
The Housing Coordinator and Building Inspector will conduct an inspection of the home to determine the scope of work. A repair list will be prepared outlining the work to be done and providing a preliminary cost estimate. A pest control specialist will perform a termite inspection. The Housing Coordinator will then meet with you to discuss the work needed. After your acceptance of the repair list, the Housing Coordinator will prepare the work write-up to be used by contractors in preparing their proposals. The Homeowner is encouraged to obtain three (3) proposals from licensed General Contractors.
If necessary, the Housing Coordinator will conduct a job walk of the property so that all interested General Contractors can survey the work to be done in order to prepare their proposals. The Housing Coordinator maintains a list of qualified general contractors. Proposals are to be received by the Homeowner/City so that the Homeowner can make a selection.
After the loan papers are signed, and your final commitment to the project is made, a preconstruction conference is held to sign the construction contract.
At this time, all specification and details of the proposed project are reviewed. This meeting also provides for the owner and contractor to confer before work starts.
All loan documentation must be completed and recorded before construction can actually begin.
Once work begins, repairs are expected to be completed promptly. Most projects are completed within 30 to 60 days. During the project, the Housing Coordinator and Building Inspector will monitor the work to assure that it is performed according to contract.
All funds are held at the City and progress payments are made as work is completed. Final payment is made to the contractor 35 days after the housing Coordinator confirms the work has been satisfactorily completed and a Notice of Completion is Recorded with the County.
For more information regarding the Rehabilitation Loan Program, please contact:
Joann Patton
Housing Coordinator
City of Taft
209 E. Kern Street
Taft, California 93268
(661) 763-3144, Ext. 24
or ask your Realtor
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