They say home is where the heart is; and your home should be a haven that offers solace and sanctuary amidst the chaos of the rest of the world. But what if your dwelling doesn’t match the vision you have for the place you rest, live, and play? If this is the case for you, you may be dreaming of a home renovation. Depending on the size of the project and cost of materials, home renovations can cost anywhere from $10,000 to $100,000; therefore, Ohio homeowners would be savvy to look for financial assistance to keep their house updated. Health and safety features, aesthetic improvements, and updates to reduce carbon footprint are all important, and each category may be supported by different loan and grant programs.
In this article we will cover:
- Home renovation grants related to energy use
- Home accessibility improvement grants
- Renovation grants for homes in rural Ohio
- Grants to renovate old houses
- Alternative funding options
Home renovation grants related to energy use
Ohio Home Weatherization Assistance Program (HWAP)
The eligibility for the Ohio Home Weatherization Assistance Program program is restricted to households at or below 200% of the poverty income guidelines, with prioritization given to elderly community members, people with a disability, families with children, or Ohio households with high energy use. The goal of the program is to increase energy efficiency in a home, and HWAP is one of the few forms of assistance that is available for both renters and homeowners.
Federal Tax Credits for Energy Efficiency
Although this isn’t a grant program, the Inflation Reduction Act of 2022 helps to put money back in homeowner pockets through 2032. This bill allows homeowners to claim federal tax credits up to $3,200 annually if the money is spent on energy-efficient upgrades. Energy Efficiency tax credits are managed by the IRS, so you will want to speak to an Ohio certified personal accountant for guidelines and filing instructions. Before applying for the tax credit, speak to a local home renovation company who can help you determine if the potential improvements are eligible for the tax credit.
General Energy Assistance
For Ohioans who may be having trouble managing their home energy cost, the Department of Development offers various energy assistance programs to help you manage your utility bills. Take a look and rest assured that your future home renovation dream can begin by increasing your financial stability today!
Home accessibility improvement grants
Ohio Housing Assistance Grant Program
The Ohio Office of Community Development manages the Housing Assistance Grant Program, which partners Ohio nonprofit agencies with local, qualified construction companies to provide home repairs and renovations to improve accessibility for disabled and mobility-impaired Ohio homeowners. The funds are provided by the Ohio Housing Trust Fund, a funding source dedicated to alleviating costs of predevelopment, renovation, and new construction as well as providing rental assistance for Ohio individuals and families who earn up to 50% of the Area Median income. More information can be found by contacting the Office of Community Development directly.
Financial Assistance for Military Veterans
If your military service to our country has left you with a disability, you may be eligible for the Home Improvement/Structural Alterations benefit (HISA) or Specially Adapted Housing Grant. The HISA benefit offers either a $2,000 lifetime benefit or a $6,800 lifetime benefit, depending on your particular situation. A Specially Adapted Housing Grant from the Department of Veterans Affairs offers grant money upwards of $100,00 for veterans with service-related disabilities to adapt their home to better meet their needs.
Renovation grants for homes in rural Ohio
If you live in a designated rural area and earn a low income, there are single-family home repair loans up to $40,000 and grants up to $10,000 for which you might be eligible. These funding types are known as Section 504 Home Repair programs and can be used to repair or modernize your home, or to remove health and safety hazards for elderly homeowners.
Grants to renovate old houses
Some people are drawn to historically significant buildings for the ability to bring the past to life, but owning an old house also comes with drawbacks in terms of construction quirks and required maintenance. The ability to complete renovations to an older home can be exacerbated by very specific guidelines if your house or neighborhood has been designated as a local landmark. The good news is that funding is available in Ohio to renovate and rehabilitate historically significant buildings. The Ohio Historic Preservation Tax Credit Program provides a tax credit to offset the cost of rehabilitating buildings that are listed on the National Register of Historic Places or are located within Historic Districts designated by the National Register, National Park Service, or Certified Local Government.
Alternatives funding avenues for Ohio homeowners
If none of the above grants or financial assistance programs seem to apply to your exact situation, consider the alternative financing possibilities listed below:
Ohio Housing Finance Agency
Although the Ohio Housing Finance Agency (OHFA) is geared more towards providing financial assistance to Ohio residents shopping for a new home, rather than renovating their old home, this resource is worth bookmarking! OHFA currently offers eight different programs through verified lenders, targeted at different eligible populations:
- The OHFA First-Time Homebuyer Program works to boost the purchasing power of Ohio residents who are buying their first home.
- YourChoice! Down Payment Assistance offers funds of either 2.5% or 5% of the home’s purchase price to apply to down payments or closing costs.
- Grants for Grads encourages recent graduates to invest in their future within Ohio by offering discounted mortgage interest rates and down payment assistance.
- The Ohio Heroes program gives back to Ohio residents who work in a public service career by offering reduced interest rates on home mortgages.
- OHFA’s Mortgage Tax Credit can be used with either the OHFA First-Time Homebuyer program, or a different mortgage option. Either way, you can receive a tax credit between 20-40% of your annual mortgage interest, up to $2,000.
- The U.S. Department of Housing and Urban Development works with OHFA to designate target Areas of Chronic Economic Distress (ACEDs) within the state of Ohio. If you live within one of these areas, you likely have access to Target Area home loan options, which can decrease your mortgage interest rate.
- Many prospective homebuyers are aware of first time homebuyer programs, but the Ohio Housing Finance Agency goes farther in allowing their residents to continue to invest in Ohio real estate by offering competitive 30-year, fixed-rate mortgages and down payment assistance to people who are not first time home buyers through the Next Home program.
- Lastly, if you financed your home purchase with down payment assistance through OHFA and would like to improve your mortgage rate and/or reduce your monthly payment, you can look into their Mortgage Refinance Program.
Home Equity Loans and Lines of Credit (HELOC)
If you have already earned substantial equity in your home, you can work with your lender to access this value in the form of a home equity line of credit, which can provide you with cash on hand to finance your home renovations.
HUD Loans
One of the most common funding alternatives to home improvement grants are loans from the U.S. Department of Housing & Urban Development (HUD). The Federal Housing Administration insures lenders against a possible loss for these types of loans, and this security allows many lenders to underwrite a Title I Property Improvement Loan. Because this is a federal program, the use of loan funds are restricted to making basic aspects of a home more livable, rather than adding luxury features. For instance, you can use a Title I Property Improvement Loan to update windows for energy efficiency, but you would not be able to use the loan to renovate your garage into a fitness space.
FHA 203(k) Rehabilitation Loans
If you are considering purchasing a fixer-upper, you might want to speak to your lender about the possibility of applying for a Mortgage Rehab Loan, which allows you to bundle the cost of the renovation with the mortgage purchase price. If you already own the home, you can also speak to your lender about refinancing into this loan type. Keep in mind, funding from this type of loan must be used on the borrower’s primary property, so you won’t be able to use this for renovating a vacation home or investment property.
Ohio home renovation contractors
Here at CORE, we want to make homeowners feel empowered to pursue their home renovations, so we hope the above information has been helpful as you consider the financial planning necessary to update your home. CORE offers full-service design and build services for kitchen and bathroom renovations, garage remodels, home extensions and extra floors in the central Ohio area. If you are ready to take the next step in your home renovation in Columbus or beyond, please don’t hesitate to contact us. Our design team can help you sketch out your vision and our construction team will bring that vision to life.
