Human Services News

Housing Assistance Council Press Room

Over six-hundred low-income families in 22 states will become homeowners within the next three years, relying on their own labor and local community development organizations that will receive loans from the Housing Assistance Council.

Most of the over $9 million committed by HAC comes from the Self-Help Homeownership Opportunity Program, which helps local nonprofit organizations to acquire land and prepare building sites for low-income homebuyers.

HAC will lend the funds to 40 nonprofit organizations in rural areas throughout the country to develop 616 self-help homes.

The program, known as SHOP, is funded by the Department of Housing and Urban Development and administered by HAC and other intermediary organizations.

"Each homebuying family will contribute at least 100 hours of sweat equity to construct their own home," explained HAC executive director Moises Loza.

"The SHOP loans from HAC help to get the process started because they cover predevelopment costs such as buying land and installing water and sewer lines.

Without this program, it can be very difficult for local organizations to finance these costs."

The local nonprofit organizations that receive SHOP funding will oversee construction and provide training in homeownership and financial management.

Typically they organize building groups of eight to ten families who work cooperatively to construct their homes over a period of eight to twelve months.

Subcontractors are usually hired to install the electrical, plumbing, and heating lines.

The groups receive SHOP funds as loans but, if they meet their production goals and other requirements, 80 percent of each loan may be forgiven.

Nonprofits can then use the money as further subsidy for the same homes  to reduce the total mortgage amounts, for example  or to develop additional self-help homes.

"We are pleased to be able to expand this homeownership opportunity to reach more families throughout rural America."

Since 1996, HAC has administered over $68 million from SHOP, assisting in the production of over 6200 self-help homes, mostly in rural areas.

Founded in 1971, HAC is a national nonprofit corporation headquartered in Washington, D.C. that helps local organizations build affordable homes in rural America by providing below-market financing, technical assistance, research, training, and information services.