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Program offering 0% interest loans for Detroit home repairs gets boost

Ariana Taylor
The Detroit News

A program that helps Detroit homeowners afford property repairs is getting a $1 million boost through a partnership with the philanthropic arm of Quicken Loans and the city. 

The Quicken Loans Community Fund also announced it would provide 25,000 homeowners with applications for the Homeowners Property Tax Assistance Program, which helps residents behind on their property taxes.

The effort is part of a partnership with the Detroit Board of Review called the Neighbor to Neighbor campaign.

Quicken Loans Inc. founder Dan Gilbert, left, is interviewed by James Chapman, Director of Entrepreneurship for the Quicken Loans Community Investment Fund during Quicken Loans Detroit Demo Day at the Detroit Music Hall, in Detroit, June 22, 2018.  Seven winning companies will receive a total of $1.2 million in funding from Quicken Loans.

The Neighbor to Neighbor campaign provides resources to Detroit homeowners who are behind on property taxes as well as collects data to help intervene in property tax foreclosures. 

"The Neighbor to Neighbor campaign and workshops are driving meaningful and sustainable reductions in property tax foreclosures, allowing thousands more Detroit residents to experience the housing stability they need and deserve," said Laura Grannemann, vice president of the Quicken Loans Community Fund, in a news release.

The campaign contacted 13,889 homeowners and found that 38% needed significant repairs to their homes. The survey prompted the Quicken Loans Community Fund to make the $1million investment to the Detroit 0% Home Repair Loans Program, which offers 0% interest loans from $5,000 to $25,000. The goal s to promote public health and safety, increase property values and help residents secure and maintain homeowner's insurance.

"Since 2015, we have made continued progress in helping Detroiters stay in their homes," Mayor Mike Duggan said in the release. "I thank the Quicken Loans Community Fund, our community partners and City of Detroit Board of Review for expanding access to programs like HPTAP, Make it Home and Pay As You Stay, which are designed to help Detroit homeowners most in need."

To help people apply for the Homeowners Property Tax Assistance Program (HPTAP),  the fund also partnered with students from the Detroit College for Creative Studies to create a guide.

Laura Grannemann, VP, Quicken Loans Community Fund, leaves the stage after her remarks.

The guide was sent to 25,000 households, including those with delinquent property taxes, those who received a HPTAP exemption within the past three years and participants of Make it Home, a Quicken Loans program that helps families avoid displacements due to tax foreclosures. 

The guide also helps homeowners become eligible for the Pay As You Stay bill, a program that removes interest, fees and penalties from delinquent property taxes, and  provides a payment plan or a 10% reduced lump-sum payment to avoid foreclosure. 

"Over the last three years, (the) Neighbor to Neighbor campaign has engaged countless homeowners who should have qualified for a complete property tax exemption but were unaware of the process," Grannemann said.

The city has also made HPTAP applications available online and waived the notarization requirement for the rest of the year. 

Exemptions from property taxes were given to 7,601 HPTAP participants in 2019. Last year's exemptions were a 70% increase from 2016, the year before the Neighbor to Neighbor campaign started. 

More people also kept their homes in 2019. Last year's Wayne County Tax Auction only included 250 owner-occupied homes, a stark contrast to 2015's auction, which had 6,408 owner-occupied homes.

Foreclosure has been an ongoing crisis in Detroit.

Detroit overtaxed homeowners by at least $600 million after it failed to accurately bring down property values in the years following the Great Recession, according to a January investigation by The Detroit News.

Of the more than 63,000 Detroit homes with delinquent debt as of last fall, more than 90% were overtaxed, by an average of at least $3,700, between 2010 and 2016, according to calculations by The News. The debt owed on about 40,000 of those homes is less than the properties were overtaxed over those seven years. 

At the same time, efforts by the city to offer debt relief programs have created a process of ongoing debt. 

In 2015, the Interest Reduction Stipulated Payment Agreement was enacted into state law and proposed by Duggan as a solution to stave off foreclosures. The plans charge a discounted 6% interest on property tax debt instead of up to 18% the county normally bills.

The plans have helped dramatically reduce Detroit's foreclosures from a record high 9,111 occupied homes in 2015 to 514 in 2019 year, a 94% decrease, according to city data. But even as many residents praise the program, for many others, the plans merely extended their debt and set the stage for thousands more possible foreclosures as deadlines expire.

Last year, data gathered by The News, in partnership with Reveal from The Center for Investigative Reporting, for the first time publicly showed the payment plan program has masked the debt problem. 

About 23%, or about 2,700 of the properties The News followed, had more debt than they did three years ago, many after owners fell behind on additional tax bills. 

►Read more: Effort to stave off Detroit foreclosures leaves many deeper in debt

►Read more: Detroit homeowners overtaxed $600 million