Should You Charge for Home Repairs?

Posted By: Becca Davis News,

Most of our member organizations do not charge clients (aka homeowners, residents, or families) for home repairs. Some nonprofits do, however. We thought it would be interesting to look at the philosophies behind both approaches and to explore the different fee models of organizations that do require some kind of contribution.

Mennonite Central Committee’s Sharing With Appalachian People (SWAP) program encourages homeowners to make some kind of donation (monetary or in-kind) but doesn’t make their services contingent on the ability to pay. Their philosophy is that folks who are invested will take better care of the repairs that are made. ReWiGo Ministries, a member of ReFrame Association based in South Carolina, also asks for donations but doesn’t require them. They are considering putting into place a structure for expected contributions for those who are not extremely low income (example: senior citizens who could afford to pay for some materials, but not the labor for home repairs).

Some Habitat for Humanity affiliates provide home repairs in addition to building new homes. However, they don’t provide anything for free. This is because they believe that requiring payment or volunteer hours (called “sweat equity”) instills a sense of pride and ownership in clients and also teaches them basic building and home maintenance skills. An article (no longer available online) in Habitat World Magazine states, “Sweat equity tells the homeowner families, donors and the public that with Habitat, people are ultimately more important than the houses…Habitat affiliates that successfully administer sweat-equity programs put both attention and intention into their mission.” The concept of sweat equity grew out of the ministries of Koinonia Farm, “taproot” of Habitat for Humanity International. The above-mentioned article says, “As homeowners work their sweat equity beside volunteers who help, they gain dignity, self-worth and a sense of community. The process reinforces the words of Koinonia leader Clarence Jordan that the poor need co-workers, not caseworkers, capital not charity.”

Almost Heaven Habitat for Humanity in West Virginia charges clients for the actual material costs of the project. Austin Habitat for Humanity requires a $25 non-refundable application fee and a $125 project fee upon approval, for a total cost of $150. They offer payment plans depending on the income and circumstances of the homeowner. The Habitat for Humanity of Greater Los Angeles requires homeowners and/or household members to complete 24 hours of sweat equity. Habitat for Humanity of Metro Denver bases their fees and sweat equity requirements on the cost of the repairs. For project cost of $5,000, for example, homeowners can either pay $300 and volunteer for 4 hours or pay $450 and have no sweat equity requirement.

Another model is Tacoma/Pierce County Habitat for Humanity’s program in Washington. They give a 0% interest loan to homeowners for the cost of materials. Habitat for Humanity of East Bay/Silicone Valley requires “between 8 and 40 sweat equity hours depending on the scope of the project – the homeowner, a household member or friend of the homeowner must be on site and willing to work in various capacities throughout the duration of the home repairs, as well as perform approved non-construction activities.” They also have modest repayment requirements. They say that repairs costing less than $1,000 require a $50 payment; and repairs valued over $1,000 are “repaid through a deferred, no-payment, no-interest 15-30 year loan, depending on the expected lifespan of the repairs provided. The loan will be for the full value of the repairs and will be evidenced by a promissory note and secured by a deed of trust that is recorded on the property owner’s title. Habitat will be paid in full upon sale or transfer of the property within the loan term. If the home is not sold or transferred during the loan term, the loan is fully forgiven.”

On the other side of the coin, Appalachia Service Project provides home repairs for free. Walter Crouch, CEO/President, says, “The vast majority of Appalachia Service Project’s clients fall into categories where we believe the burden of payment outweighs any potential benefits, e.g., the disabled, the elderly, the unemployed, and the very poor. If families choose to make donations or help with construction, their contributions are received with gratitude. But from a practical standpoint, ASP does not need this source of revenue as volunteer fees and philanthropic donations cover costs. Ultimately, the value of materials and volunteer labor are seen as ‘grace’ gifts to our families, and the responsibility of continued stewardship of these gifts is left between those we have gifted and God.”

Regardless of whether you provide free home repairs or require a contribution of some kind, you are making a big difference in the lives of low-income families. We are thankful for all home repair nonprofits and their commitment to providing occupants of substandard housing with safer, more livable shelter. The diversity of organizations’ approaches can be viewed as a strength because it means that there is something for everyone, regardless of their philosophy (in the case of volunteers and donors) or ability to contribute (in the case of clients).