Under the Title I program, approved lenders make loans from their own funds to eligible borrowers to finance home improvements, and HUD insures the lender against loss if the borrower defaults. Credit is granted based on the applicant's credit history and ability to repay the loan in regular monthly payments. This is one of HUD's most frequently used loan insurance products.
Title I home improvement loans are not government loans or grants, and are not low interest rate loans. HUD does not lend money nor regulate interest rates.
Purpose And Eligible Improvements
Title I loans may be used to finance permanent home improvements that protect or improve the basic livability or utility of the property--including manufactured homes, single-family and multifamily homes, nonresidential structures, and the preservation of historic homes. The loans can also be used for fire safety equipment.
Most of the loans are for items that provide structural additions and alterations,
exterior and interior finishing, roofing, insulation, and heating and cooling systems. The funds cannot be used for "luxury" items, such as swimming pools or hot tubs. They also cannot be used for debt consolidation, cash-out, or any non-home related expenses.
Title I Home Improvement loans on single family houses may be used for alterations, repairs and for site improvements. Loans on multifamily structures may be used only for building alteration and repairs. Structure must have been completed and occupied for 90 days.
The interest rate is a fixed rate that is generally based on the prevailing market rate in the area at time the loan is made. It is negotiable, and may vary between lenders.
Some communities participate in local housing rehabilitation programs that provide reduced-rate property improvement loans through Title I lenders.
Maximum Loan Amount