One & Two-Family Rehabilitation Loan Program
Evanston, Cook County
Finance
The City of Evanston provides revolving rehabilitation loans at zero percent interest to homeowners earning at or below 80 percent of the area median income.
Background
To preserve the quality of its housing stock and help low-and-moderate income families maintain their homes, the City of Evanston developed the One and Two-Family Rehabilitation Loan Program. Following a series of public meetings, the City created this comprehensive revolving loan using its Community Development Block Grant (CDBG) funds.
How it works
The City of Evanston provides revolving rehabilitation loans at zero percent interest for owner-occupied buildings, including single-family homes and condominiums. These loans are available to households earning at or below 80 percent of the area median income (AMI), which was $57,900 for a family of four in 2014. Loans are provided through a variety of funding mechanisms, primarily title transfer loans or zero percent interest amortizing loans. The loan is to make necessary repairs to homes, such as to correct code violations and life safety issues, increase accessibility and improve energy efficiency.
A rehabilitation specialist from the City works closely with each homeowner to develop a scope of work, solicit bids, prepare contracts and oversee technical performance. Prior to the City disbursing funds to the contractor for completed work, the rehabilitation specialist and the owner sign documents accepting the work. Additionally, the contractor signs a partial waiver of lien commensurate with the value of the completed work. Projects that qualify for assistance include kitchen/bathroom remodeling; window replacement; roof replacement; porch replacement; foundation repairs; energy conservation; and those addressing code and environmental health-related violations. CDBG funds cannot be used to expand habitable living space or make unnecessary improvements. All materials and finishes used are construction grade.
If the borrower’s income is at or below 50 percent AMI, single-family loans are deferred loans, which require no interest and no payments until the transfer of title. Loans are amortized for up to 25 years. To qualify, the applicant must have clear title and owe no back taxes. Additionally, the applicant’s after-rehabilitation property value must not exceed the city’s median single-family home value as determined periodically by the City.
Current program caps
- Single-family, owner-occupied: $50,000 per project
- Two-unit, owner-occupied: $50,000 per project
- Condominium: $20,000 per unit
- Emergency rehabilitation: $10,000 per project
Assistance
- Garage demolition: $8,000 per project
- Diseased/damaged tree removal: $6,000 per project
- Abandoned/boarded-up building: $50,000 per project
(Updated May 2014)
Contact
Department of Community Development, City of Evanston
847-448-4311, www.cityofevanston.org
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Goal
Preserve quality housing stock and help low-and-moderate income families maintain their homes.
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Target
One and two-family homes and condominiums owned by households earning no more than 80 percent area median income, which was $57,900 for a family of four in 2014
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Financing
Funded through the CDBG revolving loan fund.
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Success
Rehabilitates approximately 15 units annually.
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Lessons learned
Not everyone who is in need can be helped through the housing rehabilitation program. Therefore, having a knowledgeable and resourceful staff with social service and technical backgrounds is critical to successful outcomes for customers. Also, common elements within condominiums are not eligible for the program.