Turning Around Neighborhoods with a Loan
The Montgomery County Land Bank provides loans exclusively to local governments and public not-for-profit corporations that want to strategically renovate distressed single-family homes as part of a larger neighborhood redevelopment plan. Using the Community Residential Rehab Loan Program, you can transform these distressed properties into true gems that become catalysts for investment and revitalization throughout entire neighborhoods.
Funds for Communities to Transform Foreclosure Homes and Tax-Delinquent Properties
To participate in the Community Residential Rehab Loan Program, your local government must have a signed Memorandum of Understanding with the Land Bank or be a not-for-profit corporation within an MOU community. You may borrow funds for structural, utility, cosmetic, landscaping and energy-efficiency improvements in conforming-use, single-family detached homes located in neighborhoods your community has strategically targeted for redevelopment. The total investment (acquisition and renovation costs) may not exceed market values.
The Land Bank can work with you to acquire the property, but allows you, as borrower, to implement the improvements:
- Your organization may acquire the property, or the Land Bank may acquire it for you through the Foreclosure Acquisition Program. You are responsible for acquisition costs.
- You will manage the renovation and pay for the improvement costs with Land Bank loan funds, which are provided up front to assist with cash flow. Your organization’s procurement policies apply.
- Loan amounts range from $10,000 to $50,000.
- The repayment term is two years, or upon sale or transfer, whichever comes first.
- Additional loan requirements include
- Clean title and proof of ownership
- Collateral first mortgage on real estate asset
- Community Loan Program Agreement, promissory note, mortgage
- Processing fee of $500 plus 1% of loan principle, payable at closing.
Have a property in mind for strategic redevelopment? Contact us to learn more about your community’s loan opportunities through the Land Bank.
Ready to apply for a loan? Get started on your community’s rehab loan application.