Vermont Housing Improvement Program 2.0

If you need info about VHIP awards approved before 2024, please describe our original VHIP page. The preliminary VHIP funding was sourced from State Fiscal Recovery Funds, which had different guidelines. The requirements and options described here do NOT use to tasks approved before March 25, 2024.

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

Drawing from insights gained over the previous 3 years and more than 500 systems moneyed, this updated program preserves our dedication to expanding inexpensive housing. VHIP 2.0 now provides awards for limited new construction. Additionally, it presents a 10-year forgivable loan alongside the existing 5-year grants, intending to even more incentivize property owners. This brand-new option requires renting systems at fair market value without the need for referrals from Coordinated Entry Organizations.

Table of Contents:

What can you make with VHIP 2.0 funding?
How much financing are tasks 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 finish with VHIP 2.0 funding?

VHIP 2.0 provides grants or forgivable loans to:

Rehabilitate existing vacant units.
Rehabilitate structural components effecting numerous units, such as the roof of a multi-family residential or commercial property.
Develop a new Accessory Dwelling Unit (ADU) on an owner-occupied residential or commercial property.
Create brand-new systems within an existing structure.
Create a brand-new structure with five or less residential units.
Complete repairs necessary for code compliance in occupied systems (only qualified for ten years forgivable loan)

Rehabilitation tasks can include updates to satisfy housing codes, weatherization, and ease of access enhancements, of qualified rental housing systems.

How much financing are tasks eligible for?

Based on the kind of project, residential or commercial property owners are eligible to get approximately:

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

* Structural repair grant or loan awards are readily available for a maximum of $50,000 per award produced a residential or commercial property. For each structural award made, a rent-ready unit in the exact same structure should be overloaded with a VHIP Covenant or FLA/Promissory Note. Contact your HOC or DHCD for more details and to discuss your project if you are thinking about structural repairs that affect more than one unit.

What are the program requirements?

Program Match: All individuals are needed to provide a 20% match of the award, the choice for an in-kind match for unbilled services or owned materials. For example, an individual who gets an award of $50,000 will be needed to offer a $10,000 match.

Fair Market Rent: Participants are likewise required 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 10 years, find out more about these choices here). Participants will be required to submit an annual recertification type to guarantee they are in compliance with the program requirements. To calculate HUD FMR for your location, check out our resources on Fair Market Rent.

Landlord Education: VHIP 2.0 applicants should enjoy a Landlord-Tenant Mediation video and complete a Fair Housing Training as part of the application procedure. The Landlord-Tenant Mediation video is offered by the Vermont Landlord Association (Please click on this link to view). The online, self-paced Fair Housing training is supplied by CVOEO. It consists of a summary of state and federal anti-discrimination requirements, examples of illegal housing discrimination and prospective charges, gain access to requirements for individuals with specials needs, consisting of reasonable lodgings and affordable adjustments, and finest practices for housing suppliers. This training will be confirmed through conclusion of a brief quiz. Please click on this link to register. You will be asked to develop an account on the Ruzuku discovering platform, then you'll have immediate access to the training. If you experience any problems or have concerns, please contact CVOEO at classcoord@cvoeo.org or 802-660-3455 ext. 205.

Tenant Selection: VHIP 2.0 participants have the right to choose their renters. However, the occupants they select should fulfill the program requirements, based upon if they are registered in the 5- or 10-year tract (click on this link to get more information). For residential or commercial properties enrolled in this program, the residential or commercial property owner might not require a credit report higher than 500, and participants are limited to charging no more than one month's lease for a deposit, despite whether it is called a security deposit, a damage deposit or a family pet deposit, last month's lease, etc. Additionally, residential or commercial property owners need to cover the expense of running background examine possible renters. Residential or commercial property owners are likewise needed to accept any housing coupons that are available to pay all, or a part of, the renter's lease and energies. Additionally, residential or commercial property owners should accept paper applications for renters with limited web access.

Out-of-State Owners: Out-of-State owners are required to determine a residential or commercial property manager situated within 50 miles of the systems to guarantee a local, accountable party can manager the residential or commercial property in the absence of the residential or commercial property owner.

5-Year Grant Versus 10-Year Forgivable Loan

The main difference in between the 5-year grant and the 10-year forgivable loans are:

- The period for which the residential or commercial property owner should charge at or listed below HUD Fair Market Rent for the registered units (5 v ten years).
The 5-year grant choice comes with additional renter choice requirements to lease to a household exiting homelessness

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

5-Year Grants

Any residential or commercial property, with the exception of occupant inhabited units addressing code non-compliance issues, getting VHIP 2.0 can opt to receive a 5-year grant. This compliance period will start when the VHIP 2.0 unit is positioned in service. This grant needs that:

The system 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 deal with Coordinated Entry Lead Organizations to find appropriate tenants exiting homelessness for a minimum of 5 years or with USCRI to discover refugee families to rent the unit to

Participants should sign a rental covenant to this effect. This covenant will be effective for 5 years and states that for this period, the unit needs to stay a long-lasting rental with a regular monthly rental rate at or listed below HUD Fair Market Rent and that the Department of Housing and Community Development must 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 provided the grant identifies that a household leaving homelessness is not readily available to rent the system, the property manager shall rent the unit to a home with an earnings equivalent to or less than 80 percent of location average earnings. If such a home 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 landlord might transform a grant to a forgivable loan upon approval by DHCD and the HOC that approved the grant. When the grant is converted to a forgivable loan, the residential or commercial property owner shall get a 10% credit for loan forgiveness for each year in which the proprietor takes part in the grant program. For example, if the residential or commercial property owner participated in the grant program for 2 years prior to converting to a forgivable 20% of the funding will be forgiven, and the forgivable loan terms would make an application for 8 years.

Note. This only uses to jobs that received funding through VHIP 2.0. The initial VHIP financing was sourced from State Fiscal Recovery Funds, which had different guidelines. The requirements and options outlined here do NOT apply 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 making an application for VHIP 2.0 can choose to get a 10-year forgivable loan. This compliance duration will start when the VHIP 2.0 system is put in service. This grant requires that the unit is leased at or listed below HUD Fair Market Rent for the location for a minimum of ten years. The owner must lease the unit for 10 years at or below FMR to be forgiven in its whole. Funds will require to be paid back to the State of Vermont for every year this requirement is not satisfied i.e. if an owner just rents the system for 7 years at or listed below FMR, 3 years (30%) of funding will not be forgiven.

VHIP Documents

General Documents

VHIP 2.0 Resource Guide for Residential Or Commercial Property Owners - This thorough guide strolls residential or commercial property owners through every step of the VHIP 2.0 procedure, from figuring out if the program is a good fit for your project, how to use, payment dispensation, keeping program requirements, to offering a VHIP 2.0 residential or commercial property.

VHIP 2.0 Recipient List - The identity of VHIP recipients and the quantity of a grant or forgivable loan are public records and are published quarterly on this website.

Since there are several job types VHIP 2.0 supports, the Frequently Asked Questions (FAQs) specify to the type of project getting financing. To ask concerns about your project, connect with your regional homeownership center.

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

Fair Market Rent & Recertification

All residential or commercial property owners taking part in VHIP 2.0 are needed to charge leas at or below HUD Fair Market Rent (FMR) for the length of the agreement, depending on whether the residential or commercial property owner selects the 5-year grant or 10-year forgivable loan choice. FMRs frequently released by HUD represent the expense of renting a reasonably priced house system in the local housing market.

Fair Market Rent Calculator - To use the calculator, you should complete the utility worksheet, which indicates which energies the renter is accountable for payment. Once the energy worksheet is total, the calculator will show the maximum permitted rent based upon the county the unit is located in and the number of bedrooms.

Fair Market Rent Recertification Form - Residential or commercial property owners participating in VHIP 2.0 needs to send a yearly recertification form to ensure they comply with the program requirements, including FMR. While the program requirements are in impact, residential or commercial property owners will get an annual demand to complete the recertification type. Residential or commercial property owners are encouraged to proactively complete this type upon turnover or lease renewal.

If you require support finishing the recertification kind or determining FMR for your area, please get in touch with your regional Homeownership Center or the State Housing Division (VHIP@vermont.gov).