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Michigan homeowners can get low-interest loans for septic system replacements

Septic tank system are exposed along front property of a residential home.
Septic tank system are exposed along front property of a residential home.

Michigan is making available financing to help homeowners replace their old septic systems.

The state’s Septic Replacement Loan Program is offering loans up to $30,000 with 1% interest rates to low-income residents and up to $50,000 dollars at market rate to others.

The loans are provided through the Michigan Department of Environment, Great Lakes, and Energy (EGLE) and Michigan Saves, a nonprofit bank dedicated to financing projects aimed at reducing carbon emissions.

“Many of these systems are failing to function as intended or failing to adequately treat and process the wastewater that they are receiving, which puts not only people at risk of injury or illness, but it also puts the great waters of our state at risk for contamination and pollution,” said Anne Mitchel, who leads the program for EGLE.

Over a third of the state’s homes rely on an onsite septic system to manage, treat and dispose of household wastewater, according to state data. But the maintenance and replacement cost of these systems can cost thousands of dollars.

Michigan doesn’t have a statewide septic system sanitary code, but the Septic Replacement Loan Program is an attempt to set some standards in place for systems installed through the program.

“Any system funded with this money will be installed in accordance with these standards rather than local sanitary codes,” Mitchell said.

To begin the process of acquiring a loan through the program, homeowners need to get a quote from an authorized contractor to review their septic systems.

“Those contractors and that homeowner get a scope of work together or designs a system that meets our program standards, which can also be found on our website,” said Michigan Saves senior project manager Nishaat Killeen. “And then once they have an agreement, then they will come back to our website and apply for a loan.”

Only septic systems deemed as “failing” or “close to failing” qualify for the state loan program. That could involve sewage backups, surface discharges, or structural damage to tanks.

“The loans at market rate interest are lower than what you might get at other financing institutions,” said Killeen. “We try very hard to make sure that replacing your septic system isn’t too burdensome.”

Copyright 2024 WKAR Public Media

As WKAR's Bilingual Latinx Stories Reporter, Michelle reports in both English and Spanish on stories affecting Michigan's Latinx community. Michelle is also the voice of WKAR's weekend news programs.