Housing Rehabilitation Assistance Program
A prospective participant for this program must meet the following requirements. They must be first-time home buyers, be purchasing within Madison County, be at 80% of the area median income or below, have a median credit score of at least 620, and be purchasing the home as their primary residence. They must be purchasing the property with a mortgage from a participating lender and hold fee simple title after closing
Home buyers must purchase vacant homes that require rehabilitation. Property must be vacant at the point of contract initiation. After rehabilitation, the home must meet Housing quality Standards and any applicable local codes. Please keep in mind that vacant does not necessarily mean foreclosed or abandoned. It just means that it has to have been vacant at the time that it was listed.
- Single family residence (detached or single-family semi-detached)
- Condominium unit
- Manufactured home on permanent foundation and its own lot
- Garages (only if it is attached to a single family home)
- Building containing two or more units
- Detached garages
- Mobile homes
- Occupied Properties
- Projects that reduce the number of units in the building
Properties must, at a the conclusion of the rehab, meet HUD’s Housing Quality Standards (HQS), which is the standard for our existing HOMEbuyer Program, and must be free from any defects that pose a danger to the health and safety of the occupants.
The program guidelines require that the following rehabilitation priority be followed:
- Fix building code violations
- Meet the HQS standards
- Replace major housing systems that may be a large cost to the home buyers such as windows, HVAC, water heaters, plumbing, electrical, roof and siding
- Energy conservation
- Painting, new fixtures and Energy Star appliances
Acquisition and Rehabilitation:
Eligible home buyers will receive funding to cover the cost of rehab in addition to the down payment and/or closing costs. To participate in the program, the home buyer must accept funding for acquisition and rehabilitation.
Home buyers at 50% area median income can receive up to $5,000 to cover down payment and closing costs and up to $3,000 for home buyers at 80% area median income. In addition, home buyers will be required to contribute $1,000 or 1% of the purchase price, whichever is greater, to purchase the home.
To be eligible for the program, home buyers must receive funds for rehabilitation in addition to the acquisition assistance. The total amount of rehabilitation assistance must be a minimum of $5,000 and may not exceed $20,000 per home.
Down payment and closing costs assistance will be provided as a five-year forgivable grant secured by a Recapture Agreement and Note. Rehabilitation assistance will be provided as a five-year forgivable loan, carry 0% interest and will be secured by a Mortgage and Note.
Home buyers will be required to sign a Mortgage and note for the estimated amount of rehabilitation assistance. If the amount of rehabilitation assistance changes from the original estimate, an amendment to the loan documents for the final amount of rehabilitation assistance, which the buyers will be required to sign, will be prepared and recorded.
Home buyers will be able to apply for this program through a participating lender, or by contacting MCCD and completing the preapproval process.
Home buyer Rehabilitation Program Participating Lenders
American Portfolio Mortgage
Granite City Steel Credit Union
Cornerstone Mortgage, Inc.
Preferred Mortgage Services
First National Bank of St. Louis
Granny 8 Mortgage
For additional information on the Madison County Housing Rehabilitation Program, contact Brenda Kuberski at (618) 296-4386.