Following are frequently asked questions about the loan associated with the City ofTacoma Home Repair Program:
- Is there a monthly payment associated with this loan?
- Is there a lien on my house? If so, what does that mean?
- Is there interest on this loan?
- What if I cannot make a payment?
- What if I need to sell my home or am no longer able to live in it?
- What if I want to refinance or apply for a home equity loan?
- What if something happens to me or my partner? Will the lien be inherited by a child or family member? Will they be required to pay it off?
- What is included in this loan?
Is there a monthly payment associated with this loan?
Yes. The monthly amount will be calculated based on your income and ability to pay. For anyone who meets the Hardship Rule, there is no monthly payment and payment will be deferred for 20 years. The Hardship Rule: If the homeowner has a household income at or less than 50% of the area median income, is a senior citizen (65 years or older), and/or is permanently disabled, the homeowner may then qualify for loan deferment for up to 20 years.
Is there a lien on my house? If so, what does that mean?
Yes, there will be a lien on your home for the total amount of the loan your household is approved for, with a maximum amount of $25,000. If your monthly payments are deferred, the lien will be paid back in full to the City of Tacoma (Tacoma Community Redevelopment Authority), only when you default on the loan, if before the 20-year time period expires.
Is there interest on this loan?
No. This is a 0% interest loan. However, a 12% simple interest will be applied to your total loan amount if you default on the loan in any of the following ways:
Default on Indebtedness - Failure of the Owner to pay when due any sum owing under the Note or under any other Loan Documents.
Failure to Perform Obligations - Failure of Owner to perform any obligations owing under any of the other Loan Documents or under the contract.
Unapproved Transfer - Owner's sale, transfer, or other disposition of the Property without TCRA's prior written consent.
Failure to Reside in Property - Failure of the Owner (or of all Owners if there is more than one) to reside in the Property as the Owner's primary residence.
Other Defaults - Owner's failure to pay, or other default, in any other indebtedness secured by the Property.
Appointment of Receiver, etc.; Insolvency - The appointment of a receiver or liquidator for the Owner or the Owner's property, the filing of any state or federal bankruptcy or insolvency petition by or against the Owner, or any assignment by the Owner for the benefit of the Owner's creditors.
Death - Death of the Owner or, if the Owner is a marital community, the death of both members of the marital community.
False Statements - If any warranty, representation, or statement made or furnished to TCRA by or on behalf of the Owner under the Agreement, Note, or Loan Documents is false or misleading in any material respect at the time it is made or furnished, or if becomes false or misleading at any time thereafter.
Defective Collateralization - If the Agreement, Note, Deed of Trust, or any of the Loan Documents cease to be in full force and effect (including failure of any security agreement to create a valid and perfected security interest) at any time and for any reason.
What if I cannot make a payment?
If for any reason you are unable to make a payment you must contact, in writing, the City of Tacoma (Tacoma Community Redevelopment Authority) to explain your circumstances. Otherwise you may be considered to have defaulted on your loan.
What if I need to sell my home or am no longer able to live in it?
If you need to sell your home you must contact, in writing, the City of Tacoma (Tacoma Community Redevelopment Authority) stating your need to sell/move. If you do not contact them, you will be considered in default at the time of sale or transfer of your home.
What if I want to refinance or apply for a home equity loan?
The TCRA may subordinate if refinance will allow for lower interest rate or payment. The homeowner can take out up to $300 during the refinancing without being penalized. If the homeowner takes out more than $300, that is considered taking equity out on the home. If a homeowner takes out equity, the loan will become due and payable at this time and the TCRA will not subordinate.
What if something happens to me or my partner? Will the lien be inherited by a child or family member? Will they be required to pay it off?
If something happens to you and your partner and your home is to be sold, this will be considered a default on the lien (loan), which will then be paid in full from the proceeds of the sale of the home.
If your home is to be inherited by someone, their income will be verified.
If they meet the Hardship Rule, the loan will continue to be deferred. If they are within the income guidelines but do not meet the Hardship Rule, a monthly payment will be associated with this loan. If they exceed the income guidelines, the lien must be paid in full.
What is included in this loan?
The loan will include all repair work completed regarding health, safety, code violations, and ADA modifications. There are also administrative fees included for obtaining a credit report, title report, and like documents.
Additionally, all homes built prior to 1978 are required to have a lead-based paint risk assessment completed by a third party. The associated costs will be included in the loan, along with the costs associated with the remediation of any lead paint that is exposed and/or that will be disturbed due to repair work.
Note: We are not currently accepting applicants for any of our home repair programs.