In a nation reeling from excessive housing speculation, a federal program uses a novel concept to put families in homes: You get what you work for.
The U.S. Department of Agriculture’s Mutual Self-Help Housing program is aimed at helping low-income borrowers buy homes with reasonable mortgages and no down payments. The catch is, the families build the homes. Their labor, or “sweat equity,” becomes the down payment.
The Community Action Partnership (CAP) of Northwest Montana administers the USDA program for this part of the state. In the last eight years, CAP has overseen the construction of 136 houses, in eight-house increments.
Each grant cycle, the agency takes applications and selects eight eligible families who all build their homes at the same time, while helping the other families build theirs. The organization is currently looking for eight families within the next several weeks so construction can begin on homes for the newest grant cycle.
“That’s the whole idea behind this – everybody works on everybody else’s home,” said Marney McCleary, housing director for CAP. “This is a user-friendly, accessible program.”
Selected applicants take part in construction training sessions and are assisted through the building process by an on-site foreman. They work on weekends, evenings during the workweek or whenever fits the schedules of the eight families and foreman. It takes planning and cooperation.
Volunteers – friends, family, church members and local groups – also pitch in. Heavy machinery is subbed out, but CAP has plenty of hand tools, as well as access to a tool grant from State Farm Insurance.
The houses are built in the same neighborhood each cycle, so after months of working long hours together, the families move into their new homes and already know the neighbors well.
“It teaches how to be a good neighbor,” said Galen Amy, CAP’s development director.
When the work’s all done, families usually end up paying on a loan that’s at least $30,000 less than the appraised value, a significant savings earned through hard work. An added benefit is that the families are prepared for maintenance on a home and other aspects of home ownership, as learned through CAP’s training.
“Any challenge to home ownership, we can help them overcome that challenge,” McCleary said.
The eight new homes will be built in the Spring Creek Estates subdivision off of Three Mile Drive in Kalispell. There are also eight houses from the last grant cycle currently under construction in the same neighborhood.
The Spring Creek homes are about 1,300 square feet with three bedrooms and two bathrooms. Since the houses are energy efficient, homeowners qualify for tax credits, McCleary said.
Tanya Framness lives in a four-bedroom, two-bath house in the Mountain Vista subdivision with her husband James and three kids. Framness applied for the self-help housing program in the summer of 2008 and began building that fall.
The Framnesses were required to work 35 hours per week. If Tanya and James each worked 16 hours – say, eight on Saturday and eight on Sunday – that would equal 32 total hours, giving them three more hours to work off in order to fulfill their quota. Framness said volunteers helped out as well. The result of the hard work is a “very reasonable” mortgage.
“We never would have been able to achieve it otherwise,” Framness said. “Basically, we didn’t have to come up with any down payment. You work for your down payment.”
For more information on the Mutual Self-Help Housing program, contact Michelle Minnehan at CAP at (406) 752-6565 or visit the office at 214 Main Street in Kalispell.