RIF will lend a maximum of $100,000 to a single landlord.
Loan Product 1: Minor Repair
- Loan amount: $10,000-$24,999 per property
- Loan term: 10 years
- Forgiveness schedule: The loan will be forgiven 20% annually beginning in Year 6 if conditions are met
- Interest Rate: 6% if affordability requirements are not met
| Minor Repair Loan Product | ||
|---|---|---|
| Maximum Estimated Repair Costs at Application | Contingency Included in Loan Amount | Maximum Loan Amount |
| $20,800 | $4,199 | $24,999 |
Loan Product 2: Moderate Repair
- Loan amount: $25,000 – $100,000 – see schedule below
- Loan term: 15 years
- Forgiveness schedule: The loan will be forgiven 10% annually beginning in Year 6 if conditions are met
- Interest Rate: 6% if affordability requirements are not met
- Underwriting: The projected rental income must cover existing debt payments and other property-related costs (1.2 Debt Service Coverage Ratio)
- Repair requirements: The following repairs and upgrades may be required as part of the work scope for the moderate repair product:
- Weatherization
- Knob-and-tube remediation
- Roof repair or replacement
- Fuel oil or electric baseboard heater removal
- HVAC upgrade
- Electrification readiness measures
- Energy efficient appliance upgrades
| Moderate Repair Loan Product | |||
|---|---|---|---|
| Maximum Estimated Repair Costs at Application | Contingency Included in Loan Amount | Maximum Loan Amount |
|
| 1 unit properties | $42,000 | $8,000 | $50,000 |
| 2 unit properties | $42,000 | $8,000 | $50,000 |
| 3 unit properties | $63,000 | $12,000 | $75,000 |
| 4+ unit properties | $84,000 | $16,000 | $100,000 |
RIF will lend a maximum of $100,000 to a single landlord.
Do I have to pay the loan back?
Loan repayment will be deferred and the loan will be fully forgiven if the affordability requirements below are met. Deferral means you do not have to make any payments on the loan. If you do not apply for or meet the requirements for loan forgiveness each year, you will have to repay the unforgiven portion of the loan at 6% interest.
In order for repayment to be deferred and for the loan to be forgiven, PHDC will request a copy of the current lease for the repaired unit(s) on an annual basis and review City records to ensure the following requirements are met:
- Any rent increase cannot be more than 3%, unless you lease to a tenant using a Housing Choice Voucher (HCV), in which case the landlord can continue to request rent increases from the Philadelphia Housing Authority (PHA).
- You must provide a current lease for the repaired unit(s) each year. If building-wide repairs are completed, you must provide a copy of the lease for all units in the building.
- The property must have any code violations identified by the Department of Licenses & Inspections (L&I) corrected within six months during the loan term.
- You must maintain an active rental license during the loan term.
- You must continue to own the unit(s) during the loan term.
Are there early repayment (prepayment) penalties?
If you take out a RIF loan and prepay during the first five years of the loan term, repayment with interest will be required and you will pay a penalty. The penalty is $5,000 for the Minor Repair loan product and $10,000 for the Moderate Repair loan product.
| Minor Repair 25K/10L Loan up to $25K | |
|---|---|
| Year | Early Repayment Penalty |
| 1 | $5,000 |
| 2 | $5,000 |
| 3 | $5,000 |
| 4 | $5,000 |
| 5 | $5,000 |
| 6-10 | $0 |
| Moderate Repair Loan up to $100K | |||
|---|---|---|---|
| Early Repayment Penalty | |||
| Year | $25-50k Loan amount | $50-75k Loan amount | $75-100k Loan amount |
| 1 | $10,000 | $15,000 | $20,000 |
| 2 | $10,000 | $15,000 | $20,000 |
| 3 | $10,000 | $15,000 | $20,000 |
| 4 | $10,000 | $15,000 | $20,000 |
| 5 | $10,000 | $15,000 | $20,000 |
| 6-10 | $0 | $0 | $0 |
My property is currently vacant. Can I still apply for a RIF Loan?
Yes, RIF loans can be used to make vacant properties fit for habitation. RIF-repaired properties must maintain an active rental license and occupancy by tenants after repairs are completed.