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Tax Credits & Loans: Low-Interest Loans

before after
With assistance from the Preservation Loan Fund, this abandoned house was transformed into high-quality affordable housing.

FOR LOAN APPLICATION, CLICK LINKS:

>Loan Application Instructions
>Loan Application: Part I
>Loan Application: Part II
>Loan Application: Parts III and IV

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The Historical Preservation Loan Fund is available to preserve properties listed on the State Register of Historic Places by providing low-interest loans to public, non-profit, or private owners. Loan money may be used for needed restoration work or, in some cases, for acquiring and rehabilitating an endangered historic property. Work must meet the Secretary of the Interior's Standards for Rehabilitation. Work that has already been completed is not eligible for loan funding.

Applications are accepted at any time. To be eligible, a property must be listed in the State Register of Historic Places, either individually or as a contributing part of a historic district. To confirm if your property is listed on the State Register, email Mercedes Monteiro or call her at (401)222-4133. Eligible applications will be evaluated on factors such as the architectural and historical significance of the property, the relative need for the proposed work, and the public benefit of the proposed project. Other considerations include geographic distribution, financial need, and conformance to community planning issues.

The Historical Preservation Loan Fund Program is an adjustable rate program. The interest rate for the current round of applications is 2 percent less than the prime rate with a floor of 5 percent. Adjustments to rates are made in January of each year. The interest rate is adjusted according to the prime rate at the time of review. This review results in an increase of no more than 3 percent over the life of the loan. The applicant must grant a mortgage on the property as security. Total mortgages, including the proposed loan, may not exceed 75 percent of the after-rehabilitation appraisal. The maximum loan is $200,000, and principal and interest must be repaid in quarterly payments within five years, but the Commission may approve different terms under special circumstances.

Borrowers will be responsible for the cost of an appraisal, survey of the property's boundaries, title search, and other documentation costs. The Commission will require that contracts for rehabilitation work be awarded openly and competitively and that work be reviewed and approved prior to disbursement of loan funds to assure that the work meets historic preservation standards. In addition, the owner must sign an easement agreeing to preserve and maintain the rehabilitated property for a term of years based on the dollar amount of the loan.

In addition to making loans to individuals, the RIHPHC may also loan funds to municipalities to operate a local revolving loan program. Usually, the community targets a few historic areas or neighborhoods and uses RIHPHC funds to make a number of smaller loans to individual owners.

For more information about the Historical Preservation Loan Fund, email Jeffrey Rosenberg , or call him at (401) 222-4131.