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Renovate & Repair Program

Features & Guidelines ~ Eligibility ~ Property Guidelines ~ Frequently Asked Questions ~ Pre-Application

 

Frequently Asked Questions

What is the Renovate and Repair Home Loan Program?

The Renovate and Repair Loan Program (R&R) is a fixed, below-market rate home improvement loan offered by the Pennsylvania Housing Finance Agency (PHFA) and administered locally by the Erie Redevelopment Authority. The program is not a grant program.

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Why is the program being offered?

The Commonwealth and the Erie Redevelopment Authority want to help homeowners avoid predatory lenders and at the same time, assist in the rejuvenation of older neighborhoods and homes. (60% of housing in Erie was built prior to 1950.)

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Who is eligible to apply?

The Redevelopment Authority will make the program available to all resident homeowners within the legal limits of the city of Erie. The owner/applicant must reside in the home as a principal residence and must also meet certain credit criteria associated with obtaining a loan.

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What are the restrictions?

  • The total gross household income cannot exceed $90,000. Please note that the Renovate and Repair Home Loan Program can be used at a household with an income exceeding $90,000 if a resident at the household is disabled and the improvements will address accessibility issues at the house.
  • Applicants must have a credit score of at least 620.
  • The R&R loan, in combination with all other loans against the property, cannot exceed 120 percent of the home’s value.
  • The loan is not a home equity loan and the loan cannot be used to pay credit card debt, purchase automobiles, or used for vacations. Homeowners can use the loan to build equity and especially take advantage of the city of Erie’s Local Economic Tax Revitalization Abatement (LERTA) Program.

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What if the applicant’s credit score is too low?

  • The ERA and the credit counselors at Saint Martin Center will work with applicant to help repair credit and re-apply.

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What are the terms?

  • 10, 15, or 20 year fixed-rate loan
  • Up to $35,000 not to exceed 120% of the home’s value.
  • No Pre-payment penalty

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Will I have any fees or closing costs to pay if my loan is approved?

There will be a $50.00 charged to the applicant for a document fee. The appraisal, title search, and credit report will be paid for by PHFA.

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What are the other advantages?

  • If you qualify, the ERA may be able to combine a grant for home rehabilitation or handicapped accessibility with your loan.
  • ERA staff will assist homeowners with evaluating home improvements, writing specifications to solicit bids, inspecting work at mid-point and at completion

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What can I use the R&R loan for?

Loan funds may be used to repair items affecting the home’s basic livability, health, safety, and accessibility, or to correct code violations.

Funds may also be used to convert a multi-unit property back to a single family residence.

Eligible items include:

  • Sidewalks
  • Driveways
  • Garage
  • Stairs
  • Ramps
  • Porches
  • Foundations
  • Windows
  • Roof
  • Chimneys
  • Pest control
  • Electrical
  • Plumbing
  • Furnace
  • Central Air Conditioning
  • Kitchens
  • Bathrooms
  • Additions
  • Handicapped Access

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Does PHFA prohibit any types of uses of the money?

Yes they include, but are not limited to, luxury items or those used primarily for recreation or entertainment such as:

  • Hot tubs
  • Swimming pools
  • Decks
  • Landscaping
  • Additional garages

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Who chooses the contractor or contractors?

The homeowner, not the ERA or PHFA, will select the contractors.

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I have outstanding violations issued by the city of Erie Code Enforcement for the house in which I reside. Do I have to address those violations first?

Yes. All applicants will be checked to insure there are no documented code violations at the property for which they are seeking funds. You may use the R&R loan to pay for the code corrections.

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Can I use the program and still qualify for the city of Erie’s Local Economic Tax Revitalization Abatement (LERTA)?

Yes. While many maintenance items do not require a building permit and other items such as furnaces and new wiring would not increase your tax assessment; some work to your home may increase your assessment. Please discuss the new LERTA program with the city before you hire a contractor. Some areas of the city no longer receive the 10-year 100% tax abatement.

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What can I add to my house to build the greatest amount of equity?

The Redevelopment Authority encourages you to talk to a real estate professional about the improvements that will give you the most return on your investment.

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How do I apply?

If you are a resident homeowner in the city of Erie and your gross household income does not exceed $90,000, you can apply to use the PHFA R&R Program. Complete the Renovate and Repair Home Loan Program Pre-Application by clicking here. Pre-applications can also be obtained by contacting the ERA at 453-4505. Once the pre-application is received, ERA staff will contact you to set up a brief meeting to review the program and the pre-application.

At that meeting applicants will need to have the following:

  • Deed
  • Proof that all taxes, MUNISCO, and homeowners insurance are current
  • Most recent pay stub for all residents

Once staff has approved your participation in the program, a local mortgage underwriter will pull a credit report and issue a Good Faith estimate about a potential loan. If your credit score is 620 or better, an appraisal and title search is ordered after which the Loan Underwriter makes a decision to approve the loan.

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917 State Street, Erie, Pennsylvania 16501 Phone: 814-453-4505; Fax: 814-454-6984