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HARRISBURG, Sept. 14, 2006 - State Sen. J. Barry Stout is
encouraging local homeowners to look into a new state loan program
that will help pay for repairs and renovations.
“This is a great way for homeowners to invest in their homes and for
the state to invest in its communities,” said Stout
(D-Washington/Greene/Allegheny/Beaver/Westmoreland).
The
Pennsylvania Housing Finance Agency (PHFA) will administer the
new loan program, called Keystone Renovate and Repair. No new state
tax dollars will go towards the effort; instead, PHFA will self-fund
the entire program from current revenues.
The program will offer below-market, fixed interest rates to
borrowers for home improvement and renovation projects. Program
participants will also receive counseling about which repairs are
best, how to select a contractor, and how to determine if the work
is satisfactory.
“It’s not enough to provide low-interest loans for home repairs,”
said Stout. “It’s essential that we educate the public, so that we
can shut down these networks of crooked contractors and lenders.”
A recent state Banking Department report found that foreclosures
have been increasing in Pennsylvania, with 55,000 homes sold at
sheriff’s sales between 2000 and 2003. The report also found that a
major contributor to this trend was a number of home improvement
contractors coordinating with predatory lenders to target homeowners
for loans financing unnecessary or overpriced work.
To be eligible for the Keystone Renovate and Repair Loan Program,
homeowners must have a household income less than 150 percent of
region’s average. Applicants must live in the home for which the
loan is intended and must be current in their property tax payments.
Loans will be available up to $35,000 and for 10-, 15- and 20-year
terms.
In addition to announcing this new program, Stout also noted that he
is supporting legislation that would require home improvement
contractors to register with the state. By a vote of 36-14, the
Senate approved Senate Bill 1000 on June 26 and sent the bill to the
House, where it currently awaits committee consideration.
“The foreclosure problem has many different aspects,” said Stout.
“That’s why we must attack it from every angle - by providing
state-backed loans for home improvements to discourage predatory
lenders and by requiring state registration to scare off
unscrupulous contractors.”
For more information about the Keystone Renovate and Repair Loan
Program, call the PHFA at 1-800-822-1174.
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