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Vermont Housing Improvement Program 2.0

If you require details about VHIP awards approved before 2024, please refer to our original VHIP page. The preliminary VHIP funding was sourced from State Fiscal Recovery Funds, which had various guidelines. The requirements and options detailed here do NOT apply 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 funded, this upgraded program keeps our commitment to expanding cost effective housing. VHIP 2.0 now uses awards for limited brand-new building and construction. Additionally, it presents a 10-year forgivable loan alongside the existing 5-year grants, aiming to further incentivize property managers. This brand-new option requires renting systems at reasonable market value without the requirement for recommendations from Coordinated Entry Organizations.

Table of Contents:

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

VHIP 2.0 uses grants or forgivable loans to:

Rehabilitate existing uninhabited systems.
Rehabilitate structural aspects effecting multiple 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 brand-new structure with five or fewer property systems.
Complete repairs necessary for code compliance in occupied units (just eligible for 10 year forgivable loan)

Rehabilitation jobs can include updates to meet housing codes, weatherization, and ease of access improvements, of eligible rental housing units.

Just how much funding are jobs eligible for?

Based on the type of project, residential or commercial property owners are eligible to get as much as:

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

* Structural repair work grant or loan awards are readily available for an optimum of $50,000 per award made for a residential or commercial property. For each structural award made, a rent-ready unit in the same building need to be encumbered with a VHIP Covenant or FLA/Promissory Note. Contact your HOC or DHCD for more details and to discuss your task if you are thinking about structural repair work that affect more than one system.

What are the program requirements?

Program Match: All participants are required to offer a 20% match of the award, the alternative for an in-kind match for unbilled services or owned products. 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 consenting to charge at or listed below HUD Fair Market Rent (FMR) or coupon amount for the length of the contract (5 or 10 years, find out more about these options here). Participants will be needed to send an annual recertification kind to guarantee they remain in compliance with the program requirements. To calculate HUD FMR for your location, inspect out our resources on Fair Market Rent.

Landlord Education: VHIP 2.0 applicants need to view a Landlord-Tenant Mediation video and complete a Fair Housing Training as part of the application process. The Landlord-Tenant Mediation video is offered by the Vermont Landlord Association (Please click here to view). The online, self-paced Fair Housing training is supplied by CVOEO. It consists of an introduction of state and federal anti-discrimination requirements, examples of illegal housing discrimination and possible penalties, access requirements for people with specials needs, consisting of affordable lodgings and sensible adjustments, and finest practices for housing companies. This training will be validated through conclusion of a brief quiz. Please click on this link to sign up. You will be asked to develop an account on the Ruzuku finding out platform, then you’ll have instant 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 individuals have the right to select their renters. However, the tenants they select must meet the program requirements, based upon if they are registered in the 5- or 10-year tract (click here to read more). For residential or commercial properties registered in this program, the residential or commercial property owner may not require a credit history greater than 500, and participants are limited to charging no more than one month’s rent for a deposit, despite whether it is called a security deposit, a damage deposit or an animal deposit, last month’s lease, etc. Additionally, residential or commercial property owners need to cover the expense of running background look at potential . Residential or commercial property owners are likewise needed to accept any housing coupons that are offered to pay all, or a portion of, the renter’s lease and utilities. Additionally, residential or commercial property owners must accept paper applications for occupants with restricted internet access.

Out-of-State Owners: Out-of-State owners are needed to determine a residential or commercial property supervisor situated within 50 miles of the systems to make sure a local, accountable party can supervisor 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 duration for which the residential or commercial property owner must charge at or below HUD Fair Market Rent for the enrolled units (5 v 10 years).
The 5-year grant alternative comes with additional tenant selection requirements to rent to a home exiting homelessness

For more information specifics about these 2 alternatives, review the sections listed below.

5-Year Grants

Any residential or commercial property, with the exception of tenant inhabited systems resolving code non-compliance problems, making an application for VHIP 2.0 can choose to receive a 5-year grant. This compliance period will begin as soon as the VHIP 2.0 system is placed in service. This grant needs that:

The system is rented at or listed below HUD Fair Market Rent for the area for at least 5 years.
That the residential or commercial property manager work with Coordinated Entry Lead Organizations to find ideal tenants exiting homelessness for at least 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 work for 5 years and states that for this duration, the system must stay a long-term leasing 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 determines that a household exiting homelessness is not offered to rent the unit, the property owner will rent the unit to a family with an income equivalent to or less than 80 percent of area mean income. If such a home is not available, the residential or commercial property owner may rent the unit to another home with the approval of the DHCD or HOC.

Grant to Loan Conversion: A landlord may convert 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 will receive a 10% credit for loan forgiveness for each year in which the property owner participates in the grant program. For example, 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 funding will be forgiven, and the forgivable loan terms would request 8 years.

Note. This only uses to projects that got financing through VHIP 2.0. The initial VHIP financing was sourced from State Fiscal Recovery Funds, which had various policies. The requirements and alternatives outlined here do NOT apply to tasks authorized before March 25, 2024, and those grants can NOT be converted to forgivable loans.

10-Year Forgivable Loans

Any residential or commercial property getting VHIP 2.0 can decide to receive a 10-year forgivable loan. This compliance period will start once the VHIP 2.0 system is positioned in service. This grant requires that the system is leased at or below HUD Fair Market Rent for the location for a minimum of ten years. The owner should lease the system for ten years at or listed below FMR to be forgiven in its whole. Funds will require to be paid back to the State of Vermont for each year this requirement is not fulfilled i.e. if an owner just rents the unit 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 strolls residential or commercial property owners through every action of the VHIP 2.0 process, from figuring out if the program is an excellent suitable for your task, how to apply, 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 amount of a grant or forgivable loan are public records and are published quarterly on this site.

Since there are a number of project types VHIP 2.0 supports, the Frequently Asked Questions (FAQs) specify to the type of job looking for financing. To ask questions about your task, link 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 taking part 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 picks the 5-year grant or 10-year forgivable loan alternative. FMRs regularly released by HUD represent the expense of leasing a reasonably priced residence system in the local housing market.

Fair Market Rent Calculator – To utilize the calculator, you must complete the energy worksheet, which indicates which energies the occupant is accountable for payment. Once the energy worksheet is total, the calculator will show the maximum allowed lease based on the county the unit lies in and the number of bedrooms.

Fair Market Rent Recertification Form – Residential or commercial property owners taking part in VHIP 2.0 should submit an annual recertification type to guarantee they abide by the program requirements, consisting of FMR. While the program requirements are in impact, residential or commercial property owners will receive an annual request to finish the recertification form. Residential or commercial property owners are encouraged to proactively complete this type upon turnover or lease renewal.

If you need assistance completing the recertification form or identifying FMR for your area, please get in touch with your local Homeownership Center or the State Housing Division (VHIP@vermont.gov).

More Questions?

As this program develops, the Department is working to increase accessibility and response eligibility questions. Additional details and answers to frequently asked questions will continue to be posted to this website as offered. Click here to join our e-mail list and stay up to date on Vermont Housing Improvement Program 2.0 updates and news.