Pricing and Payment for Repair Products Alyssa Lasseter NRI Program Manager

Why Repairs Are Important Definitions Funding Repair Programs Pricing Repair Products for Homeowners Agenda

Serve at least one family per year through one of the following housing interventions: (i) new home (ii) rehabilitated home (iii) repaired home (through A Brush with Kindness or similar repair program) (iv) weatherized home A minimum of one family served over a three-year period must be through a rehab or new home construction. Good Standing

Need Neighborhood Revitalization Stakeholder Interests (volunteers, donors, stakeholders) Our Vision: A world where everyone has a decent place to live Our Mission: Seeking to put God’s love into action, Habitat for Humanity brings people together to build homes, communities and hope. Why Repairs Are Important

Definitions Funding Repair Programs Pricing Repair Products for Homeowners Agenda

NRI The mission of NRI: Neighborhood Revitalization Initiative affiliates serve more families by responding to community aspirations with an expanded array of products, services and partnerships, empowering residents to revive their neighborhoods and enhance their quality of life. The vision of NRI: Neighborhoods across the country are revitalized into vibrant, safe and inviting places to live for current and future residents. This will happen through the hard work of engaged citizens, partnerships with civic and business groups and a renewed community spirit. Definitions

Repairs A “repair” is the repair or renovation of an existing housing unit that is not owned by the affiliate, so long as: The housing unit is owned and inhabited by an individual or family that has been approved in accordance with the affiliate’s Board approved family selection process The work is performed under a written agreement, including scope of work and payment terms, between the homeowner and the affiliate in accordance with the affiliate’s Board approved procedures for repair projects The work fully complies with applicable local building codes and other legal requirements Definitions

Home Preservation - Exterior work that includes painting, patching, minor repair, landscaping and replacement of exterior building materials for maintaining good or sound condition. (Note: An A Brush with Kindness project is reported as a Home Preservation project). Weatherization - Work done to improve the energy efficiency and indoor air quality of a structure. The scope of work of a weatherization project is defined by a comprehensive energy audit performed to determine the scope of work, and also testing of the home upon completion, and should include a homeowner education component. Critical Home Repair - Extensive interior or exterior work performed to address health and safety issues or code violations. Critical home repair includes such activities as a change to, or repair of, materials or components; a reconfiguration of space; a modification for accessibility; installation or extension of plumbing, mechanical or electrical systems on an existing structure. Definitions

Funding The funding an affiliate secures prior to starting a repair project from donors. Pricing The process of determining the full cost of the project and what the price will be for the homeowner. Payment The amount the homeowner will pay, and the terms that they will pay that amount. Definitions

Why Repairs Are Important Definitions Funding Repair Programs Pricing Repair Products for Homeowners Agenda

Determining the Repair Costs Project costs should include; the cost of purchased building materials; the value of donated building materials and donated professional services; the costs of professional services and contracted labor; direct costs of affiliate labor in performing, supervising or coordinating the work (including, but not limited to: transportation, material storage, insurance, loan origination, closing and servicing) permits (if any); indirect costs (including, but not limited to: staff time and office overhead).

 How many repair projects a year?  Why and how are you/did you begin a repair program?  What would/are your sources of funding be?  Individuals, churches, foundations, sponsorships?  Other financing?  Other programs?  How do you discover opportunities and keep up-to-date on potentially, useful programs?  Are you optimistic about the future of funding a repair program for your affiliate? Funding Repair Programs – Questions to Consider for Sustainability

Why Repairs Are Important Definitions Funding Repair Programs Pricing Repair Products for Homeowners Agenda

Habitat for Humanity is a hand up, not a hand out. Partnering with families is foundational to our work and our ministry. Financial contributions give families a sense of pride in what they accomplished and it gives them a truer sense of ownership, whether it be of the house or of the improvement that’s being made to the house. For our ministry to be sustainable and indeed to expand, we have to stick with the principle that says we offer a hand up, not a hand out. That's not always the easiest way to execute our programs, but payment for repair products is critical to our long-term viability and the mission to serve even more families in need of a safe and affordable home to live. Larry Gluth Senior Vice President of United States and Canada

 An affiliate should adopt a policy on repair pricing and payment that:  Follows the repair pricing guidelines to identify the full cost of the repair;  And, incorporates at least one of the payment models to determine the price for the homeowner. Repair Pricing

 Families must demonstrate need, ability to pay and willingness to partner Repair Pricing Guidelines Family Selection* see the New Family Selection Affiliate Operations Manual for additional information on these categories Prepare for family selection Reach out to families (recruit) Perform the application work Select the family Communicate the decision

 Affiliates should structure their payment plan in such a way as to ensure that the monthly payment when combined with current home financial obligations (mortgage, insurance, property taxes and, where applicable, mortgage insurance and loan servicing) shall not exceed 30 percent of the household’s gross income (unless the affiliate develops a separate policy for families on fixed incomes). Repair Pricing Guidelines

Why Price Repair Products 1.Identity It is foundational to our work and our ministry. 2.Dignity and Success of the Homeowner We partner with families. It gives them a sense of pride in what they accomplished and it gives them a truer sense of ownership…. We offer a hand up, not a hand out…. What the poor need is capital, not charity. 3.Sustainability of the Affiliate and Program Growth For our ministry to be sustainable and indeed to expand, we have to stick with the principle…. It’s critical to our long-term viability and the mission to serve even more families in need of a safe and affordable home to live.

What are the challenges?

1.Costs 2.Funders prohibit or discourage charging 3.Legal issues 4.Homeowners can’t afford it 5.Public Relations 6.Competition 7.Sweat equity

Homeowner Agreement

Pricing Options 1.100% Cost 2.Sliding Scale 3.Fixed Cost 4.Fixed Percent of the Cost

Payment Options 1.Third Party Loans 2.Third Party Servicing 3.Prepayment 4.Downpayment 5.Early Payment Incentive 6.Secured Loans 7.Unsecured Loans

My.Habitat Resources

Questions?

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