In the February post we talked about our free credit counseling program. A credit counseling session is the first step for applicants in each of our homeownership programs. The first, which we also previously covered, consists of available, existing homes for sale with no assembly required. The second, which we’ll talk about now, is called Self Help Homes, which require some assembly from the team of soon-to-be homeowners.
Self Help Homes is a program available in rural areas, like NAHN’s five county service area of Silver Bow, Jefferson, Beaverhead, Powell, and Madison, that assists hard-working low to moderate income families to achieve the dream of homeownership.
Self Help homeowners, once they’ve received mortgage approval, contribute 65% of the labor on the construction of their own brand new home, with the help of friends, family, and NAHN’s construction professionals. Technical tasks are performed by licensed contractors. Any task that can be done by a novice (with guidance) is completed by the families to save on the overall cost of labor. Each family agrees to commit to working as often as possible until every home is complete. No homeowner is expected to do this on their own. Each household is encouraged to recruit friends, family, and other volunteers to help on a regular basis, so that every family contributes an equal amount of the shared labor.
Self Help Homes are built in groups, usually with anywhere from 4 to 8 or more partner families building at the same time, and sometimes in the same area, depending on the land available and how many homeowners are building. From start to finish, a build can take anywhere from 6-12 months, and is largely dependent on daily volunteer participation (the more often homeowners and volunteers come out to work, the faster the homes are completed). Homeowners work not only on their own home, but every home in the group, until they are all complete. When every home in the group is move-in ready, all the families move in to their homes at the same time.
Self Help Homes give families with low to moderate incomes an opportunity to own a home that they otherwise wouldn’t be able to afford. Homeownership, which is often not affordable to families with low to moderate incomes, can become affordable through the unique features of Self Help Homes. Self Help Homes allow hard working families to earn “sweat equity” in their home, by doing much of the labor themselves and with friends and volunteers, rather than paying a contractor to do it for them. The cost of construction can be lowered by up to $20,000 this way. Always working with supervision, Self Help Homes also allow homeowners to earn the peace of mind of knowing their home is well built, because their sweat went into every step of construction.
Owning a Self Help Home requires the homeowner to take on a mortgage. Even with families contributing 65% of the labor, there are still costs associated with the construction of a new home that the homeowner is responsible for paying. Fortunately, there are additional features built into the mortgages that further add to the affordability of owning a Self Help Home for low to moderate income homeowners. Self Help Home mortgages can feature interest rates as low as one percent and payback terms of 33 years (as opposed to the more traditional 30 year mortgage). These features help to keep the homeowner’s monthly house payment manageable.
It’s important to remember that each individual homeowner’s mortgage financing will look different. Each person will qualify for a different amount based on their personal financial picture: their income, debt, and credit report. The size of every house also varies according to the size and needs of the family that will occupy it. When buying a Self Help Home, a homebuyer never buys more house than they need and is involved in designing the look of the home from the very beginning. Working with multiple existing NAHN house plans and layouts, homeowners choose the plan that best suits their needs and budget, and makes decisions about every detail down to the type of wood flooring and the color of the siding and trim. Every Self Help Home is unique and reflects the personality of each family.
Stay tuned to NAHN.com for the next installment of this series, where I will discuss NAHN’s house plan options and how the highly energy efficient design of every plan further adds to the affordability and comfort of NAHN’s Self Help Homes.
To find out if you qualify, or for more information, please call NAHN’s office in Butte at (406) 782-8579 or fill out the form HERE to be contacted.
NAHN owes a special thanks to Dustin at RCAC for creating the Self Help Housing 50 year anniversary logo. Self Help Homes have been built all around the country for 50 years, AND last year the 50,000th Self Help Home was built! That’s 50,000 families that achieved the dream of homeownership!