In 2008, The Canadian Renovation Funding Program was established to supervise The Renovation Co-op’s complex system of Subsidies, Rebates and Loan Programs.
The program consists of a select team of retired and semi-retired financial specialists, each having had past, successful careers within specific areas of the Financial Services Industry, ranging from Residential/Commercial Mortgage Financing & Investment Banking, to Institutional Banking, Private Lending and Fiduciary Management.
The Funding Program has 2 major functions:
Free Loan Advisory Service:
Provides each client with a targeted, recommendation to a specific, Co-op-Approved Mortgage Brokers (when requested by the client only).
Subsidy Fund Management:
Provides the approval, management and administration of all Subsidy and Rebate Programs on behalf of The Renovation Co-op, including all Client Renovation Credit Accounts and Cash Incentive Programs.
Subsidies & Rebates
In 2012, The Renovation Co-op launched The Subsidy Discount Program, establishing a special fund supported by service-provider membership and administration fees, along with contributions from segments of the construction and financial service sectors throughout Ontario.
To ensure the full use of available funds, each approved amount is subject to a 5-day withdrawal period pending deposit or contract signature. For approval information see Subsidy Approval Process.
How the program works…
A percentage of all monthly membership fees and other revenues are set aside and applied towards various projects through an Internal “Grant” Process”, through which limited portions of the monies are applied toward the cost of various projects on a case-by-case basis.
The amount and approval of each subsidy request is determined by a small group of funding managers who jointly review the proposed project, taking into consideration the type and scope of the work, as well as the competitive nature of the job. Funding approval sessions take place several times throughout the day
The member-contractor signs the contract with the homeowner for the discounted price and is then reimbursed, or subsidized directly from the fund.
The Subsidy Discount Program helps our member-services avoid situations where they may face having to either cut their price substantially to accommodate a client who has a limited budget (which almost always lessens the contractor’s quality of service or materials) or to simply decide not to pursue the project at all.
Cash Incentive Programs
In addition to its role of referring clients to The Renovation Co-op’s approved mortgage brokers, The Canadian Renovation Funding Program oversees the development, coordination and administration of the Co-op’s various cash incentive programs.
- This includes the strict management of The Subsidy Discount Funds (see Subsidy Discount Program below) that are posted within each estimate, along with the disbursement of funds offered through other discount and rebate programs.
In addition, The Funding Program maintains a watchful eye over the availability of all such funds, ensuring a fair balance of cash distribution for all projects. The amount of funds for each individual project is approved on a discretionary basis, and is determined by a small group of internal managers on a daily basis.
Note: None of the Renovation Co-op’s incentive programs have been put in place for the purpose of becoming built-in, “hidden costs” to the client. In fact, the existence of these programs is one of the primary reasons why The Renovation Co-op is able to attract more “seasoned” and professional service providers into its membership.
The Reason: As all incentive funds come from outside sources, which includes a percentage of the Co-op’s revenues from monthly service-provider membership fees, contributions from within the construction sector and other related industries, the member-contractor or architect doesn’t have to lower his/her own bid price (see Bidding System) in order to accommodate a client’s low budget. The discount automatically applied for, following the completion of the bidding process. see The Co-op’s Estimating Procedures.
Notice: Each one of The Renovation Co-op’s incentive programs is designed to increase the client’s ability to pay for renovations or architectural services, while safely increasing the volume of clients offered to its member-service providers. In addition, these programs have been established to enable the Co-op’s member-pricing to remain competitive within the marketplace while maintaining a high level of professionalism
When a new client first registers into The Renovation Co-op, a special Renovation Credit Account is set up containing a “Zero-Balance” ($0).
If the client purchases a mortgage through a Co-op-Approved Mortgage Broker, or buys or sells their home through a Co-op-Approved Realtor, a credit of $10,000 is entered into the client’s Renovation Credit Account.
Portions of the client’s Renovation Credit can be used toward the price of specified types of renovations when performed by a Renovation Co-op member-contractor.
The allowable amount of credit to be applied towards a renovation estimate is determined by a pre-announced. “Allowable Percentage” of the Best Co-op Price as indicated within the client’s estimate. (see Estimating Procedures)
Each type of General Contractor-Level Project is assigned an “allowable percentage” to be used by a client’s Renovation Credit.
For example, during any given month, The Renovation Co-op may announce that the “Allowable Percentage” for all Basement Finishing Projects will be 5%. This means that a client can use his or her Renovation Credit (if enough credit exists within the client’s account at the time) to deduct 5% from the Best Co-op Price as indicated within the client’s estimate.
For further details see examples below.
Following the same example, the client purchased drawings through a member-architect. The Architectural Rebate made available for this specific project is $800.
Net Price: $13,020
Note: The Architectural Rebate is available with no withdrawal date attached to it. The rebate can be applied towards the same project at any time.
When you purchase or refinance your mortgage through a participating mortgage broker, you’ll receive a credit of $10,000 toward your personal Renovation Credit Account balance.
About the Renovation Credit Account:
When a client initially registers into The Renovation Co-op, a Renovation Credit Account is initiated with a zero ($0) balance. Currently, if a client has purchased a mortgage through a Co-op-approved broker, or purchased/sold a home through one of the Co-op’s participating realtors, a credit amount is added to client’s Renovation Credit balance.
Portions of this credit can be used toward the cost of renovations if purchased through a Renovation Co-op Member-Contractor.
Here’s how it works:
When you request an estimate through The Renovation Co-op for a specific type of general contracting project, we will let you know (before your estimate is processed) what percentage of the sale price can be applied using your available Renovation Credit Funds.
The Renovation Co-op publicly announces on radio or within our website which types of projects to which clients can apply their Renovation Credit. For example, during a specific month, clients may be able to apply their credit towards 2% of the sale price for Basement Finishing projects. (maximum credit: $1500).
During another month, the percentage of the sale price for Basement Finishing may be higher, with a higher limit. For example, 4% of the sale price with a limit of $2,000.
Note: The allowable Renovation Credit are applied over and above any other subsidies or rebates that have been included as part of your estimate.
Using the example above, the client has purchased a mortgage through a Co-op-approved Mortgage Broker. A credit of $10,000 has now been added to the client’s Renovation Credit Account. The allowable percentage of the Best Co-op Price
Note: Both the allowable Renovation Credit and the Architectural Rebate are offered over and above any other Subsidies or Discounts included within the estimate.
When you purchase or sell your home through a participating realtor, you will also receive a $10,000 credit toward your Renovation Credit Account balance
Note: Renovation Credit Account balances are completely transferable. To help you sell your existing home, we will issue a Certificate of Transfer to your buyer, who will then be able to utilize whatever leftover credit there is in your account and apply the balance towards future renovations.
Or, you can carry your balance with you and apply the funds toward future renovations to your next home. And if you once again purchase your new home or financing it through a participating mortgage broker and/or realtor, your Renovation Credit Account balance will be replenished accordingly.
Following the same example above, the client has purchased and/or sold his/her home through a Co-op-Approved Realtor
As the client has arranged a mortgage through a Co-op-Approved Mortgage Broker or Lender, the client’s Renovation Credit Account has already been initiated with a credit balance of $10,000. By purchasing or selling the home through the Co-op-Approved Realtor, an additional $10,000 is added to the credit balance (as shown).
The following example shows the client’s increased Renovation Credit Balance and the new credit balance at the bottom.