What does this program do?
Also known as the Section 504 Home Repair program, this provides loans to very-low-income homeowners to repair, improve or modernize their homes or grants to elderly very-low-income homeowners to remove health and safety hazards.
Who may apply for this program?
To qualify, you must:
- Be the homeowner and occupy the house
- Be unable to obtain affordable credit elsewhere
- Have a household income that does not exceed the very low limit by county
- For grants, be age 42 or older
- Loans may be used to repair, improve or modernize homes or remove health and safety hazards
- Grants must be used to remove health and safety hazards
- Maximum loan is $400,000
- Maximum grant is $100,000
- Loans and grants can be combined for up to $50,000 in assistance
What you need to know about government funding for a new home:
- The federal government does not give housing grants directly to individuals. The funds are given to states and certain municipalities, who in turn, distribute the funds to residents.
- No grant will cover 100% of the cost of a house.
- The government will not give a grant to anyone who cannot use it toward a mortgage; therefore, qualification for a mortgage is necessary.
- Any program the federal government has to assist first-time buyers in a home purchase will require that you attend a HUD approved Housing Counseling class. They help people get their finances organized so they will qualify for a mortgage.
- Contact your local government for help - directory of official state, county and local government websites.
- HUD-approved Housing Counseling - HUD funds housing counseling agencies throughout the country who can give you advice on buying a home, renting, defaults, foreclosures, credit issues and reverse mortgages.
- Local Homebuyer Programs - in addition to HUD's mortgage insurance programs, there may be programs sponsored by your state or local government or other organizations.
- Low Downpayment Information - will facilitate approval of downpayment assistance through secondary financing programs and will permit nonprofit and government agencies greater flexibility in providing downpayment and other assistance to prospective homeowners through secondary financing.
- Home Improvement Help - facts and the pitfalls of home improvements.
- Housing Choice Voucher (Section 8) - allows very low-income families to choose and lease or purchase safe, decent, and affordable privately owned rental housing.
- Starting your own business - Be prepared and understand the basics from the Small Business Administration.
- FFA-Benefits helps citizens access government benefit eligibility information through a free, confidential, and easy-to-use online screening tool. After answering some basic questions, you will get a a report listing the benefit programs for which you may be eligible.
- The Housing Act of 1949 as amended, 7 CFR Part 3550
- HB-1-3550 - Direct Single Family Housing Loans and Grants Field Office Handbook
Why does USDA Rural Development do this?
Helping people stay in their own home and keep it in good repair helps families and their communities. Homeownership helps families and individuals build savings over time. It strengthens communities and helps many kinds of businesses that support the local economy.NOTE: Because citations and other information may be subject to change, please always consult the program instructions listed in the section above titled "What Governs this Program?" Applicants may also contact your local office for assistance.
