KeyBank Launches New Key Cares Loan Program to Fund Home Repairs in Cuyahoga County

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Under the Key Cares Loan Scheme, the role of the HRRC is still crucial, but different from that of the Challenge Scheme.

Borrowers must first go to the HRRC to get a referral for a Key Cares loan. HRRC will review the suitability of the loan and the client’s ability to repay at this stage, which includes a full financial review and home appraisal.

With a recommendation in hand, about 90% of the job is done, Allen said. The borrower can then take the referral to any key bank branch and complete the loan application.

Once a check is sent to the client, however, they are not required to continue working with the HRCC, as might have been expected under the Challenge program.

HRRC courses and advice will always be available and strongly encouraged. The nonprofit has secured funding from the county to hire additional people to administer the program over the next several years.

Clients are simply not required to work with the agency after receiving their money.

If the borrower wants to take care of a contractor alone instead of choosing one referred by the HRCC, he can do so. And while HRRC will offer loan advice and home repair courses, which help homeowners not be taken advantage of by contractors, the borrower doesn’t need to take any of these. All of these additional services are voluntary.

“We will still make every effort to follow up with the borrower even though it’s not mandatory,” Allen said.

This means that some, but not all, of the care built into the Challenge Loans program that helped facilitate its success is missing with Key Cares Loans.

This dynamic with Key Cares gives borrowers more freedom than existed with the Challenge program, but it is some of these missing pieces that may raise concerns.

“What bothers me is that once you have the money, nothing ties you to the HRRC anymore,” Allen said. “We may take a picture of your home or solicit follow-ups from you, but unfortunately there are no real connections once someone receives funding.”

There is no longer an inspection by the HRCC required before final payments are released to the contractor.

And because the client’s financial assessment is built into the loan process, with follow-ups being voluntary, HRRC will not necessarily know if a borrower is in arrears, in which case it will generally seek to provide targeted advice.

Now, Key Cares borrowers will not necessarily have verified credit histories like Challenge program borrowers.

However, the troubled neighborhoods that housing advocates like Ford say tend to benefit the most from these home repair loan programs often have homeowners who benefit from this extra guidance.

“With this new program, KeyBank and Cuyahoga County are to be commended for taking a big step forward in meeting home repair credit needs,” Ford said. “But I am concerned that the program does not include two of the components of the initial challenge loan program: there will be no final inspection by the HRRC to ensure that repairs have been carried out correctly, and the HRRC will not will not be notified if a borrower falls behind on payments and therefore no opportunity to offer assistance.”

“As we move forward,” he added, “I hope other banks will partner with HRRC and include all the features of the Challenge Loan program.”

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