Q.   WHAT IS A REHABILITATION LOAN?

A.   It is a zero percent loan from the City of Lancaster funded by HUD through the Housing and Community development Act of 1974 to rehabilitate owner-occupied properties.

Q.   WHAT TYPES OF LOANS ARE AVAILABLE?

A.   Depending on family size and income, homeowners may qualify for either a repayment loan, or a forgiveness loan.  Repayment loans are paid back monthly for a term of 15 years.  Forgiveness loans are as follows: ten percent (10%) of the total loan amount is forgiven annually.  A Combination of the two types of loans may also be given.  The homeowner would pay a portion of the loan and the remaining portion would be forgiven in ten years.  The homeowner must remain living in the property for the term of the loan.

Q.   WHAT IS THE MAXIMUM AMOUNT AVAILABLE FOR A REHABILITATION LOAN?

A.   The amount of the repairs equals the amount needed to bring the property up to code.  The maximum amount to be funded for the repairs is $24,999, including any repairs made through the Critical Repair Program.

Q.   WHO IS ELIGIBLE FOR A LOAN?

A.   Owners who occupy the home, meet the current family income guidelines and meet all criteria as established by the Homeowner Rehabilitation Program and HUD.

Q.   WILL A LIEN BE PLACED ON MY PROPERTY?

A.   Yes.  A Mortgage (lien), which is recorded at the Lancaster County Recorder of Deeds Office, will be placed on your property.  When your loan balance is $0.00, the lien will be satisfied.

Q.   WHAT IF I MOVE OR SELL MY PROPERTY BEFORE THE LIEN IS SATISFIED?

A.  The balance of your loan, whether a repayment or a forgiveness loan, will be due.

Q.   CAN THE PROPERTY BE LOCATED ANYWHERE?

A.   To be eligible, the property must be within the city limits.

Q.   WHAT KIND OF WORK MAY BE DONE?

A.   Any work needed to bring the property up to the current City of Lancaster Housing Code as adopted by Lancaster City Council.

Q.   WHAT IF THE FUNDS ARE NOT ENOUGH TO BRING MY HOME UP TO THESE STANDARDS?

A.   A determination is made by the Rehabilitation Specialist to ensure the property justifies rehabilitation within the allotted grant and loan maximum limits.

Q.   WHO DECIDES WHAT WORK IS NEEDED?

A. The City of Lancaster’s Rehabilitation Specialists will create a work write-up, only including work that brings the property up to the current City Housing Code.

Q.   WHAT IF I HAVE AN EMERGENCY?

A.   Contact our office.  The Critical Repair Program is specifically designed to assist with emergency repairs.

Q.   WHO WILL DO THE WORK?

A.  The owner will choose contractors to bid on work as stated on the bid packet.  If homeowners are not familiar with any contractors, the City staff will provide you with a list of licensed and lead trained contractors for you to choose from.  Contractors may bid on work as long as they meet specific qualifications (refer to handout “Some things homeowner should think about before selecting a contractor”).  The contractors will bid on the work, and you choose the contractor you want, as long as they provide a responsible bid.  Responsible bids are bids that include all work as specified in the work write-up, and must be within 15% of the Rehabilitation Specialists estimate.

Q.   WHO WILL INSPECT THE WORK?

A.   The Rehabilitation Specialist and/or City Housing staff will make periodic inspections of all work preformed.

Q.   HOW LONG DOES THE REHABILITATION WORK TAKE?

A.   The amount of time depends upon the amount of work that is necessary to bring your house up to the Rehabilitation standards.  Rehabilitation work must begin within 30 days of signing the agreement with the contactor and must be completed within 90 days of signing the contract.  Contract extensions may be given for change orders or for unforeseen setbacks, such as in-climate weather.