Waveland Park Neighborhood Association

Questions & Answers about the NFC as a Resource for Homeowners

Oct 13, 2003

Waveland Park neighbors and homebuyers have responded enthusiastically to NFC programs providing home improvement and home purchase loans. To date over $3.5 million in loans have been made by the NFC in the Waveland Park neighborhood. While NFC loans for home purchase will be of most interest to people moving in to the area, most readers of this newsletter are probably homeowners in the area now, and may have more interest in a home improvement loan. To find out how the NFC may be helpful to Waveland Park homeowners, we contacted Gary Dodge, Executive Director of the NFC.

Q: How can homeowners in Waveland Park benefit from NFC programs?

A: If you own and reside in a home, NFC home improvement loans can help improve your property. We provide financial assistance in making major repairs. We also provide refinance loans with rehabilitation dollars, and a number of residents have used our program to obtain lower interest rates and monthly payments, while also making improvements.

Q: If I am thinking of making improvements or taking care of needed maintenance, why should I talk to NFC instead of some other lenders?

A: The difference between NFC loans and other loans for home improvement is that a part of the loan may be ?“forgivable,?” meaning that no payback is required. The portion of the loan that is forgiven depends on the amount needed to be borrowed for repairs or improvements, and on the borrowers?’ income. As much as $10,000 may be forgiven. Our requirement for forgiveness is that you reside at the residence. A portion of your loan is forgiven each year you reside there.

Q: I heard that there is a lot of red tape and inspections, and that it takes forever to get an NFC loan to improve my home ?– is that true?

A: There are program requirements and procedures involved in getting assistance from NFC, but it certainly doesn?’t take forever. Most of our loans are processed and closed in 30 to 45 days. We do require a property inspection to help us determine what repairs to a property may be needed. The forgivable portion of our loans are funded by the City of Des Moines and Polk County, so NFC is accountable to them to ensure that we will help bring residences up to current building codes, and that we address any health and safety issues. Our inspections are performed by City of Des Moines housing inspectors. That inspection might determine that house has an older furnace or inadequate electrical service, and we would ask that replacement or repairs be made. However, a borrower might also want a kitchen or bath remodel, or a new garage, and we will finance those repairs. We are interested in helping with projects that add value and utility to a residence, as well as those that correct problems.

Q: What about the length of time involved in the process?

A:The speed at which an application is completed is largely dependent on the homeowner. After the inspection is completed it is reviewed with the homeowner, and needed repairs are pointed out. The homeowner then obtains bids for the work from a qualified contractor. When all bids are obtained they are reviewed and approved by NFC as part of the loan approval process. Your loan amount, including the forgivable portion, is based on the bid amounts. Your contractor can begin work after the loan is approved and closed. When we close the loan, money for the repairs is put in to an escrow account at NFC. You authorize us to pay the contractors as work is completed. We do inspect to endure that the contractor has completed the work, but this usually takes no more than 24-48 hours. We try to ensure prompt payment to contractors.

Q: Besides making repairs, how can the NFC programs help me?

A: NFC?’s programs help improve the value of your home by correcting problems or by making improvements. As more residents of the neighborhood utilize the program, values increase all across the area. The subsidy for repairs we offer also acts as an incentive to home buyers. If you are selling your home, a buyer can come to NFC to obtain their home purchase loan, and we will include a forgivable loan to them for repairs. We also offer homebuyers down payment and closing cost assistance that they can not obtain elsewhere. If you are selling a home, ask your realtor to contact NFC. He can put an NFC sign in the lawn along with his, and we can also provide him brochures about the program to give to potential home buyers. You can also schedule a ?“pre-inspection?” of your property, which will identify repair needs, and speed the processing of a buyers?’ loan application if they come to NFC. This inspection is free of charge to the seller.

Q: I am trying to sell my house myself. Does it qualify for NFC financing?

A:Almost all homes in the neighborhood qualify for financing. There are a few commercially zoned areas where a house may not qualify, so be sure to inquire with an NFC loan originator by calling 246-0010. The originator can also provide you our signage, brochures, and arrange an inspection of your property to help you advise potential buyers of our program.