Vermont Housing Improvement Program 2.0

If you need information about VHIP awards approved before 2024, please describe our initial VHIP page. The preliminary VHIP funding was sourced from State Fiscal Recovery Funds, which had various regulations. The requirements and alternatives described here do NOT use to projects approved before March 25, 2024.

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

Drawing from insights gained over the past 3 years and more than 500 systems moneyed, this updated program keeps our dedication to expanding affordable housing. VHIP 2.0 now provides awards for minimal brand-new building. Additionally, it presents a 10-year forgivable loan alongside the existing 5-year grants, intending to even more incentivize landlords. This new option needs leasing units at reasonable market value without the requirement for recommendations from Coordinated Entry Organizations.

Tabulation:

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

VHIP 2.0 uses grants or forgivable loans to:

Rehabilitate existing vacant systems.
Rehabilitate structural aspects effecting multiple systems, such as the roofing 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 brand-new structure with 5 or fewer domestic units.
Complete repair work essential for code compliance in occupied systems (only eligible for 10 year forgivable loan)

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

Just how much financing are projects eligible for?

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

$ 30,000 per unit for rehabilitation of 0-2-bedroom systems.
$ 50,000 per system for rehab of 3+ bedroom systems, structural elements affecting numerous units *, new unit creation, or production of Accessory Dwelling Units (ADUs)

* Structural repair work grant or loan awards are offered for a maximum of $50,000 per award made for 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 details and to discuss your task if you are considering structural repairs 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 option for an in-kind match for unbilled services or owned materials. For instance, an individual who receives an award of $50,000 will be required to provide a $10,000 match.

Fair Market Rent: Participants are also required to sign a rental covenant consenting to charge at or below HUD Fair Market Rent (FMR) or voucher quantity for the length of the contract (5 or 10 years, discover more about these options here). Participants will be required to submit a yearly recertification type to ensure they are in compliance with the program requirements. To determine HUD FMR for your location, have a look at our resources on Fair Market Rent.

Landlord Education: VHIP 2.0 applicants should view a Landlord-Tenant Mediation video and complete a Fair Housing Training as part of the application process. The Landlord-Tenant Mediation video is provided by the Vermont Landlord Association (Please click on this link to view). The online, self-paced Fair Housing training is supplied by CVOEO. It includes a summary of state and federal anti-discrimination requirements, examples of illegal housing discrimination and possible penalties, gain access to requirements for people with disabilities, including reasonable accommodations and affordable modifications, and finest practices for housing companies. This training will be confirmed through conclusion of a short test. Please click on this link to sign up. You will be asked to develop an account on the Ruzuku learning platform, then you'll have immediate access to the training. If you experience any problems or have questions, please contact CVOEO at classcoord@cvoeo.org or 802-660-3455 ext. 205.

Tenant Selection: VHIP 2.0 participants have the right to select their tenants. However, the renters they select need to fulfill the program requirements, based on if they are enrolled in the 5- or 10-year system (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 rating greater than 500, and participants are restricted 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 rent, etc. Additionally, residential or commercial property owners should cover the expense of running background look at possible renters. Residential or commercial property owners are also required to accept any housing vouchers that are offered to pay all, or a part of, the tenant's rent and energies. Additionally, residential or commercial property owners should accept paper applications for occupants with restricted internet access.

Out-of-State Owners: Out-of-State owners are required to determine a residential or commercial property supervisor located within 50 miles of the units to ensure a local, responsible party 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 duration for which the residential or commercial property owner must charge at or listed below HUD Fair Market Rent for the enrolled units (5 v ten years).
The 5-year grant choice includes additional occupant selection requirements to lease to a family leaving homelessness

To find out more specifics about these two choices, review the areas below.

5-Year Grants

Any residential or commercial property, with the exception of tenant occupied units attending to code non-compliance issues, requesting VHIP 2.0 can decide to receive a 5-year grant. This compliance period will begin as soon as 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 area for a minimum of 5 years.
That the residential or commercial property supervisor work with Coordinated Entry Lead Organizations to discover suitable renters leaving homelessness for a minimum of 5 years or with USCRI to discover refugee households to lease the unit to

Participants need to sign a rental covenant to this impact. This covenant will be efficient for 5 years and states that for this duration, the system must remain a long-lasting rental with a monthly rental rate at or below HUD Fair Market Rent which the Department of Housing and Community Development should approve 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 figures out that a home exiting homelessness is not offered to rent the system, the proprietor will lease the unit to a family with an earnings equal to or less than 80 percent of area median income. If such a home is unavailable, the residential or commercial property owner may lease the unit to another household 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 authorized 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 owner 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 transforming 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 applies to projects that got financing through VHIP 2.0. The preliminary VHIP financing was sourced from State Fiscal Recovery Funds, which had different regulations. The requirements and alternatives detailed here do NOT use to projects approved before March 25, 2024, and those grants can NOT be converted to forgivable loans.

10-Year Forgivable Loans

Any residential or commercial property using for VHIP 2.0 can decide to get a 10-year forgivable loan. This compliance period will start when the VHIP 2.0 unit is put in service. This grant requires that the system is rented at or below HUD Fair Market Rent for the area for a minimum of ten years. The owner needs to rent the unit for ten years at or listed below FMR to be forgiven in its totality. Funds will require to be repaid 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 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 walks residential or commercial property owners through every action of the VHIP 2.0 procedure, from identifying if the program is an excellent suitable for your job, how to apply, payment dispensation, keeping program requirements, to selling 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 numerous project types VHIP 2.0 supports, the Frequently Asked Questions (FAQs) specify to the type of task requesting funding. To ask concerns about your task, get in touch with your local 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 participating in VHIP 2.0 are needed to charge leas at or listed below HUD Fair Market Rent (FMR) for the length of the agreement, depending on whether the residential or commercial property owner chooses the 5-year grant or 10-year forgivable loan choice. FMRs frequently released by HUD represent the expense of renting a moderately priced dwelling unit in the regional housing market.

Fair Market Rent Calculator - To utilize the calculator, you need to finish the utility worksheet, which shows which energies the tenant is accountable for payment. Once the utility worksheet is complete, the calculator will reveal the optimum allowable rent based on the county the unit lies in and the variety of bed rooms.

Fair Market Rent Recertification Form - Residential or commercial property owners participating in VHIP 2.0 should send a yearly recertification form to guarantee they comply with the program requirements, consisting of FMR. While the program requirements are in result, residential or commercial property owners will get a yearly demand to finish the recertification form. Residential or commercial property owners are motivated to proactively complete this form upon turnover or lease renewal.

If you need support completing the recertification type or figuring out FMR for your location, please connect with your local Homeownership Center or the State Housing Division (VHIP@vermont.gov).