Vermont Housing Improvement Program 2.0

If you require details about VHIP awards given before 2024, please refer to our initial VHIP page. The preliminary VHIP funding was sourced from State Fiscal Recovery Funds, which had different policies. The requirements and options laid out here do NOT apply to jobs authorized before March 25, 2024.

The Vermont Housing Improvement Program (VHIP) is relaunching as VHIP 2.0!

Drawing from insights acquired over the past 3 years and more than 500 systems funded, this upgraded program maintains our commitment to expanding economical housing. VHIP 2.0 now provides awards for limited new building. Additionally, it introduces a 10-year forgivable loan alongside the existing 5-year grants, aiming to further incentivize landlords. This brand-new option requires leasing units at reasonable market value without the requirement for referrals from Coordinated Entry Organizations.

Tabulation:

What can you do with VHIP 2.0 financing?
Just how much financing are jobs qualified for?
What are the program requirements?
5-Year Grant Versus 10-Year Forgivable Loan
VHIP 2.0 Documents Resource Guide for Residential Or Commercial Property Owners
Fair Market Rent (Recertification).
FAQ's.
Recertification.
VHIP Recipient List

Resource Guide for Residential Or Commercial Property Owners Program Stats

What can you do with VHIP 2.0 financing?

VHIP 2.0 provides grants or forgivable loans to:

Rehabilitate existing uninhabited units.
Rehabilitate structural elements effecting several systems, such as the roof of a multi-family residential or commercial property.
Develop a brand-new Accessory Dwelling Unit (ADU) on an owner-occupied residential or commercial property.
Create new units within an existing structure.
Create a new structure with five or fewer property units.
Complete repairs essential for code compliance in occupied units (just eligible for 10 year forgivable loan)

Rehabilitation tasks can include updates to fulfill housing codes, weatherization, and accessibility enhancements, of qualified rental housing units.

How much funding are projects eligible for?

Based upon the kind of job, residential or commercial property owners are qualified to get approximately:

$ 30,000 per system for rehab of 0-2-bedroom systems.
$ 50,000 per unit for rehabilitation of 3+ bed room units, structural aspects impacting numerous units *, brand-new unit production, or development of Accessory Dwelling Units (ADUs)

* Structural repair work grant or loan awards are offered for a maximum of $50,000 per award produced a residential or commercial property. For each structural award made, a rent-ready system in the exact same structure must be overloaded with a VHIP Covenant or FLA/Promissory Note. Contact your HOC or DHCD for more information and to discuss your project if you are considering structural repair work that impact more than one system.

What are the program requirements?

Program Match: All individuals are needed to offer a 20% match of the award, the alternative for an in-kind match for unbilled services or owned products. For instance, a participant who receives an award of $50,000 will be required to supply a $10,000 match.

Fair Market Rent: Participants are likewise needed to sign a rental covenant agreeing to charge at or below HUD Fair Market Rent (FMR) or coupon quantity for the length of the arrangement (5 or ten years, discover more about these alternatives here). Participants will be needed to send an annual recertification kind to guarantee they are in compliance with the program requirements. To determine HUD FMR for your location, check out our resources on Fair Market Rent.

Landlord Education: VHIP 2.0 candidates must enjoy a Landlord-Tenant Mediation video and finish a Fair Housing Training as part of the application process. The Landlord-Tenant Mediation video is supplied by the Vermont Landlord Association (Please click on this link to see). The online, self-paced Fair Housing training is provided by CVOEO. It consists of a summary of state and federal anti-discrimination requirements, examples of prohibited housing discrimination and possible penalties, gain access to requirements for people with impairments, including sensible lodgings and sensible adjustments, and best practices for housing suppliers. This training will be verified through conclusion of a brief quiz. Please click on this link to sign up. You will be asked to produce an account on the Ruzuku finding out platform, then you'll have instant access to the training. If you experience any issues or have concerns, please contact CVOEO at classcoord@cvoeo.org or 802-660-3455 ext. 205.

Tenant Selection: VHIP 2.0 participants can pick their renters. However, the tenants they pick need to fulfill the program requirements, based upon if they are enrolled in the 5- or 10-year system (click on this link to read more). For residential or commercial properties registered in this program, the residential or commercial property owner may not need a credit rating higher than 500, and individuals are limited to charging no greater than one month's lease for a deposit, no matter whether it is called a down payment, a damage deposit or an animal deposit, last month's lease, and so on. Additionally, residential or commercial property owners must cover the expense of running background examine possible occupants. Residential or commercial property owners are also needed to accept any housing vouchers that are available to pay all, or a part of, the tenant's lease and utilities. Additionally, residential or commercial property owners must accept paper applications for occupants with restricted internet gain access to.

Out-of-State Owners: Out-of-State owners are required to identify a residential or commercial property manager situated within 50 miles of the systems to ensure a regional, accountable celebration can supervisor the residential or commercial property in the lack of the residential or commercial property owner.

5-Year Grant Versus 10-Year Forgivable Loan

The primary distinction between the 5-year grant and the 10-year forgivable loans are:

- The period for which the residential or commercial property owner need to charge at or listed below HUD Fair Market Rent for the enrolled units (5 v 10 years).
The 5-year grant alternative comes with additional tenant choice requirements to rent to a family leaving homelessness

To get more information specifics about these 2 choices, evaluate the sections listed below.

5-Year Grants

Any residential or commercial property, with the exception of occupant inhabited units resolving code non-compliance issues, looking for VHIP 2.0 can decide to receive a 5-year grant. This compliance period will start once the VHIP 2.0 system is placed in service. This grant needs that:

The unit is leased at or below HUD Fair Market Rent for the area for a minimum of 5 years.
That the residential or commercial property supervisor work with Coordinated Entry Lead Organizations to find ideal occupants leaving homelessness for at least 5 years or with USCRI to discover refugee homes to lease the system to

Participants must sign a rental covenant to this result. This covenant will work for 5 years and states that for this duration, the system should remain a long-lasting leasing with a regular monthly rental rate at or listed below HUD Fair Market Rent which the Department of Housing and Community Development need to authorize the sale of the residential or commercial property.

Tenant Selection: If the Department of Housing and Community Development (DHCD) or the Homeownership Center (HOC) that released the grant identifies that a household exiting homelessness is not available to rent the system, the proprietor will rent the system to a household with an earnings equal to or less than 80 percent of area typical earnings. If such a household is not available, the residential or commercial property owner might rent the unit to another family with the approval of the DHCD or HOC.

Grant to Loan Conversion: A proprietor might transform a grant to a forgivable loan upon approval by DHCD and the HOC that approved the grant. When the grant is transformed to a forgivable loan, the residential or commercial property owner shall receive a 10% credit for loan forgiveness for each year in which the property manager takes part in the grant program. For instance, if the residential or commercial property owner took part in the grant program for 2 years prior to converting to a forgivable 20% of the financing will be forgiven, and the forgivable loan terms would obtain 8 years.

Note. This only applies to tasks that got funding through VHIP 2.0. The initial VHIP financing was sourced from State Fiscal Recovery Funds, which had various regulations. The requirements and choices detailed here do NOT use to projects authorized before March 25, 2024, and those grants can NOT be converted to forgivable loans.

10-Year Forgivable Loans

Any residential or commercial property applying for VHIP 2.0 can opt to receive a 10-year forgivable loan. This compliance duration will begin as soon as the VHIP 2.0 system is placed in service. This grant needs that the system is rented at or below HUD Fair Market Rent for the area for at least ten years. The owner must lease the system for ten years at or below FMR to be forgiven in its entirety. Funds will need to be repaid to the State of Vermont for every single year this requirement is not fulfilled i.e. if an owner just leases the unit for 7 years at or listed below FMR, 3 years (30%) of financing will not be forgiven.

VHIP Documents

General Documents

VHIP 2.0 Resource Guide for Residential Or Commercial Property Owners - This in-depth guide walks residential or commercial property owners through every action of the VHIP 2.0 procedure, from identifying if the program is an excellent fit for your project, how to apply, payment dispensation, preserving program requirements, to offering a VHIP 2.0 residential or commercial property.

VHIP 2.0 Recipient List - The identity of VHIP recipients and the amount of a grant or forgivable loan are public records and are released quarterly on this site.

Since there are several job types VHIP 2.0 assistances, the Frequently Asked Questions (FAQs) specify to the kind of project requesting funding. To ask questions about your task, link with your regional homeownership center.

Rehabilitation or Conversion of Unoccupied Units
Accessory Dwelling Units
New Unit Creation (within a new structure).
Rehabilitation of Occupied Units

Fair Market Rent & Recertification

All residential or commercial property owners getting involved in VHIP 2.0 are required to charge rents at or listed below HUD Fair Market Rent (FMR) for the length of the agreement, depending upon whether the residential or commercial property owner picks the 5-year grant or 10-year forgivable loan choice. FMRs frequently published by HUD represent the expense of renting a reasonably priced home unit in the regional housing market.

Fair Market Rent Calculator - To use the calculator, you must finish the utility worksheet, which indicates which energies the tenant is accountable for payment. Once the energy worksheet is complete, the calculator will show the optimum permitted rent based upon the county the unit is located in and the variety of bedrooms.

Fair Market Rent Recertification Form - Residential or commercial property owners taking part in VHIP 2.0 should submit an annual recertification kind to guarantee they abide by the program requirements, including FMR. While the program requirements are in effect, residential or commercial property owners will get an annual demand to complete the recertification form. Residential or commercial property owners are encouraged to proactively complete this kind upon turnover or lease renewal.

If you require assistance finishing the recertification form or determining FMR for your location, please get in touch with your local Homeownership Center or the State Housing Division (VHIP@vermont.gov).