Four Minneapolis neighborhoods are teaming up to start the FIXIT Fund, a home loan cooperative offering low-interest home loans to residents in Kenny, Lynnhurst, Fulton and Armatage.
The neighborhoods are pooling about $700,000 in funds to offer loans on a first-come, first-serve basis starting April 27. Loan amounts are up to $20,000, a big increase from some neighborhoods’ prior programs.
“Hopefully that larger amount will get people excited about it,” said Kathy Engen, a Kenny board member.
Loans can cover both exterior and interior projects, which is a change for most neighborhoods, and interest rates are significantly lower for some neighborhoods (3% for home improvement, 0% for emergency repair).
“Everybody has something new in this for them,” said Ruth Olson, neighborhood coordinator at Kenny, Lynnhurst and Fulton.
Loans can apply to projects like radon mitigation, mold removal or remodeling, with the exception of luxury projects like pools, saunas and non-permanent appliances.
Olson said it makes sense for the neighborhoods to work together, because strong housing stock in one neighborhood benefits the entire area.
“We want people to improve their homes so they stay,” she said, mentioning families who have a second baby and head to the suburbs. “This lets them finish off the basement or lets them add a second bathroom. It lets them make their home livable for their family as it is today, and they don’t feel that they have to leave. It’s no longer ripe pickings for a developer or another infill housing project.”
Since the housing market crashed, neighborhoods have issued perhaps one-three loans per year, Olson said.
The program was revamped when the neighborhoods’ previous home loan administrator, Center for Energy and the Environment, raised administrative fees to $5,000 per year. The neighborhoods decided to pool funds through the Greater Metropolitan Housing Corporation. The loan program is funded with the city’s Neighborhood Revitalization Program money.
It was no small task to launch the co-op, and neighborhood associations spent the past year hashing out the details of the loans: income limits, the length of deferred payments, and how the funds should be pooled.
“I’ve been told this is the first time neighborhoods have gotten together and done a co-op housing program,” Olson said. “We need to be doing more of that in this era of less funding.”
Many other neighborhoods offer home loan and grant programs as well. Bryn Mawr has an energy savings program; East Calhoun offers home security subsidies and grants for rain barrels, compost bins or raingardens; East Isles offers home security grants; Lowry Hill East has low-interest loans for residential and commercial property; Lyndale has home loans for homeowners and rental property owners; and Whittier offers home improvement loans with 2% interest rates.
For more information on the loan cooperative, contact your neighborhood association: [email protected], [email protected], [email protected], or click “Contact Us” at armatage.org. For a map of Minneapolis neighborhoods, visit the city’s website.