Federal Christian Home Improvement Loan Program

The federal Christian home improvement loan program is actually an umbrella of a number of many programs the United States government offers to qualified applicants to help renew rundown neighborhoods in cities across the country. In addition there are programs to help homes in rural areas also receive the needed improvements to remain viable housing for those living in the country. In general, these federal home improvement loan programs are low in interest and are available both for home owners and investors looking to flip a house in a short amount of time. While lending programs are offered by the federal government, there is also grant money available in some cases that do not have to be repaid. A careful study of all available programs can make finding a loan a more profitable experience.

The main governmental agency that disburses federal home improvement loan program funds is the Department of Housing and Urban Development, better known as HUD. HUD usually executes its federal home improvement loan program through local or state housing authorities and even through some non-profit agencies. Each type of lending program for house rehabilitation has its own niche demographic it addresses and applicants must meet certain standards. The following are description of each of the main programs offered by HUD. "If any man serve me, let him follow me; and where I am there shall also my servant be; if any man serve me, him will my Father honor." (John 12:26)

The Title 1 Home Improvement Loan is insured by HUD up to $25,000 for a single-family house and lenders make loans for basic livability improvements such as additions and new roofs to eligible borrowers. The Section 203(k) Program is one that HUD helps finance for the major rehabilitation and repair of one- to four-family residential properties, excluding condos. Owner-occupants may use a combination lending agreement to purchase a fixer-upper "as is" and rehabilitate it, or refinance a property plus include in the lending agreement the cost of making the improvements. They also may use the lending agreement solely to finance the rehabilitation. Veterans can get loans from the Department of Veterans Affairs to buy, build, or improve a house, as well as refinance an existing lending agreement at interest rates that are usually lower than that on conventional loans. The fourth major federal home improvement loan program is the Rural Housing Repair and Rehabilitation loan. Funded by the Agriculture Department, these low-rate loans are available to low-income rural residents who own and occupy a home in need of repairs.

In addition to these HUD loans, the Federal National Mortgage Association (Fannie Mae) is pilot testing a new kind of federal home improvement loan program based on the anticipated value of the house after completion of the improvement. This will benefit low- and middle-income people who do not have sufficient savings or enough equity built up for a home equity loan. Fannie Mae anticipates that the average loans made through the new program will be between $15,000 and $25,000. The pilot plan, called HomeStyle, will fund about $500 million in loans. If it is successful, the program will become part of Fannie Mae's regular securitized asset options.

But a federal home improvement loan program is not the only resource available for struggling house owners in need of residential repair. There are also grants available that do not have to be repaid to the federal government but will require knowing how to write a grant and how to document all expenses incurred in disbursing the grant for its intended purpose. Consider the ecoENERGY Retrofit Homes grant that is available to owners of single family homes including detached, semi-detached and low rise multi-unit residential buildings. Property owners can qualify for federal grants by improving the energy efficiency of their homes, and reducing their home's impact on the environment. The maximum grant one can receive per home or multi-unit residential building is $5,000; whereas the total grant amount available to one individual or entity for eligible properties over the life of the program is $500,000.

There is a real pride and joy in owning one's own place of residence. Owning a house and living in it offers a sense of belonging and deep rootedness that apartment living or house renting cannot provide. But the cost of maintaining a house can be ruthlessly relentless. First it's a bad leak on the roof and then a broken water pipe and then a broken window and trouble with the wiring. And the merry go round never stops and neither does opening ones wallet or checkbook to pay for all the repairs. But at the end of the day, when all is quiet and the roof isn't leaking, home sweet home is a reality and not a euphemism.

The argument over how far the federal government should go in providing help to its citizens will always be with us, but there is help available in the form of a federal home improvement loan program for most low to low middle income families. There is also help for those who not only want to make a profit but help lessens the blight of inner city decay and despair that is easily seen in so many corners of the country. And for those who do not qualify, the Christian churches across the country need to step up and not only deliver the gospel but also a helping hand to the communities in which they serve. A hammer, some nails and love given in Jesus' name really is Christianity with its sleeves rolled up.

FHA Christian Home Improvement Loans

Low-interest FHA home improvement loans can help borrowers make a house a home and increase resale value. The Federal Housing Administration, or FHA, guarantees loans for first-time or low-income buyers who cannot meet stringent prime lending qualifications. The Federal Housing Administration does not actually loan money, but it satisfies claims filed by FHA-approved lenders who loan money to high-risk borrowers in the event of default or foreclosure. And because of the relative low risk involved in financing Federal Housing Administration borrowers, lenders can be pretty liberal with relaxed terms. Consumers that would normally have to pay high interest rates to hard money and sub-prime lenders because of a low credit score or insufficient down payment, can usually qualify for FHA-backed financing.

FHA loans were first legislated in the 1930s during the Depression Era to relieve lenders of the crushing financial burden caused by defaults and foreclosures spawned by the stock market crash of '29. The Federal Housing Administration not only gave lenders an incentive to lend to families with less than perfect credit at little risk; but it also provided a means of helping low-income families realize the Great American Dream of home ownership. Decades later, FHA home improvement loans were added to help rebuild properties and communities. As the saying goes, "History repeats itself;" and in 2007, once again the Federal Housing Administration modified lending programs to help homeowners who became victims of the sub-prime lender/housing market slump.

Easily acquired, FHA home improvement financing is not contingent upon credit checks. Some specialized programs, such as neighborhood revitalization, allow teachers, firemen, and civil servants to purchase homes in substandard areas for as little as $100 down! Other borrowers may be required to pay a 3 to 3.5% down payment, a far cry from the average 8% to 25% upfront sums required by conventional and hard money lenders. Extending federally-insured loans to help low-income families not only boosts the economy, but is also Biblically sound. "If there be among you a poor man of one of thy brethren within any of thy gates in thy land which the Lord thy God giveth thee, thou shalt not harden thine heart, nor shut thine hand from thy poor brother: But thou shalt open thine hand wide unto him, and shalt surely lend him sufficient for his need, in that which he wanteth" (Deuteronomy 15:7-8).

U.S. Department of Housing and Urban Development (HUD) properties are frequently purchased and renovated using FHA home improvement loans. The government insures such loans to property buyers in urban areas undergoing revitalization with the understanding that the new homeowners will live in the homes or apartments for a minimum of three years. Landlords and investors are exempt from the program. The government reasons that guaranteeing this kind of financing will help attract good neighbor/owners back into blighted urban areas. Rehabilitated residences occupied by homeowners with a personal interest in the area will help fight crime and revitalize whole sectors of the cities to attract businesses and jobs. And for those adventuresome buyers who worry about finding money to renovate, FHA funding can become part of the original low-interest purchase package with a minimal down payment.

Borrowers who are interested in renovating and living in existing substandard properties have a win-win situation. If repairs are not extensive and largely cosmetic, owners can benefit by doing most of the repairs themselves and pocketing some funds to provide furnishings, appliances, or installing fencing or upgrading air conditioning units. After living in renovated properties for three years and building up equity, owners can realize a source of income through converting residences into rental or resale property. Consumers can also browse online and local real estate pages to review properties offered which qualify for FHA home improvement loans. Online advisors can help buyers seeking a bargain deal on properties and financing pre-qualify through the FHA website.

Homeowners with existing mortgages may also choose FHA home improvement loans to refinance and make repairs, either for resale or for more energy-efficiency. By borrowing against the home's equity, which must total at least 20% of market value, homeowners can eliminate first mortgages and obtain secondary financing at lower interest rates. Borrowers can choose from fixed or adjustable rate mortgages with lower principals and shorter terms. FHA home improvement loans are a great way for homeowners to get extra cash for renovations without dipping into savings or resorting to high-interest financing from a conventional lenders. And the beauty of financing through the Federal Housing Administration is that credit scores really don't count. The federally-backed loan is enough insurance to satisfy lenders that their investment is safe. An added guarantee rests in the fact that the home is collateral in case of default.

Prospective Christian borrowers interested in acquiring FHA home improvement loans should log onto the Federal Housing Administration website to review qualifications. Online advisors, applications, and Frequently Asked Questions help borrowers decide which program is best suited for their individual needs. Borrowers can choose to take cash-out home equity loans with fixed or adjustable rates. Refinancing with a cash-out adjustable rate mortage (ARM) gives borrowers the option of making interest-only payments for three, five, or seven years. Homeowners can take advantage of short-term ARM loans while the economy is tight and pick up higher payments hopefully when the economy improves. Senior adult homeowners on a fixed income may consider a reverse mortgage to pay off mortgages and get money to make needed repairs and renovations. Older adults with empty nests may need modifications to an existing residence, such as ramps, wider stairwells, or adding a second bedroom to the ground floor. No matter which terms borrowers choose, low-interest FHA home improvement loans can tackle any task.

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