Buying/Repairing a Home With Help From USDA's Single Family Housing Direct Loan

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The U.S. Department of Agriculture'The U.S. Department of Agriculture'<WBR>s

" Rural Development " office has a direct loan and grant program available to

low-income working families and individuals for purchasing a home, for

building a home, or for buying a new manufactured home put on a permanent

foundation. No down payment is required and assistance may be available to r

 

For moderate income individuals and families, there is a Guaranteed Loan

program.

 

For individuals and families who own their own home, repair loans of up to

$20,000 are available.

 

For those over the age of 62 who qualify, grant funds of up to $7,500 are

available for home repairs.

 

For more information:

 

_http://www.rurdev.http://wwhttp://www.rurdehttp_

(http://www.rurdev.usda.gov/rd/pubs/pa1674h.html)

 

 

MORE INFO ...........................

Buying a House With Help from USDA

Section 502 Direct Loan Program

 

_http://www.rurdev.usda.gov/rd/pubs/pa1674h.html_

(http://www.rurdev.usda.gov/rd/pubs/pa1674h.html)

 

 

The Direct Homeownership Loan program is available to lower income

individuals and families who wish to live in rural areas or rural cities or

towns.

Under the program, individuals or families receive a loan directly from Rural

Development. Payments are based on income, with no downpayment required. You

must be unable to obtain a homeownership loan from a bank or other conventional

sources.

Loans under the Direct Homeownership Loan program are made to families with

incomes below 80 percent of the median income level of the communities in

which they intend to live.

Almost half of these loans are made to families and individuals with very

low incomes. Since Rural Development is able to make loans to those who will

not qualify for a conventional loan, the direct loan program enables many

people to buy homes who otherwise could not do so. Even if you have minor

credit

problems, Rural Development may still be able to work with you.

No Downpayment

There is no required downpayment for a USDA direct housing loan. The standard

term for a loan is 33 years for most borrowers. However, 38-year loans are

available to those who cannot afford a 33-year loan.

The interest rate for direct housing loans is set by Rural Development, and

is based on your current income. Your local USDA Rural Development office can

estimate the interest rate you would pay.

For further information on the Single Family Housing Direct Loan program, and

to learn if you are eligible for assistance, contact the USDA Rural

Development local office serving your area. Rural Development employees will

help you

complete an application.

The Mutual Self-Help Housing Program

Many rural families have achieved the American dream of owning their own

homes through USDA's Mutual Self-Help Housing program.

Under this program, families provide a substantial portion of the labor

involved in building their own homes. This " sweat equity " contribution reduces

the total cost of purchasing a home -- allowing many people to purchase houses

that otherwise would have been out of reach. Also,because it brings different

families together to work on each other’s houses, the program builds and

strengthens the ties of community.

Self-Help works in combination with a grant program to nonprofit

organizations and the direct single family lending program, although other home

financing sources can be used. The nonprofits help families become successful

homeowners by providing technical assistance. This includes homeownership

education,

loan packaging, and construction supervision.

The Mutual Self-Help Housing program has been in operation since 1971. It is

active throughout the country and helps some 1,500 rural families build their

own homes each year. Your USDA Rural Development local office can tell you

if a Self-Help Housing effort is operating in the area in which you wish to

live.

Home Improvement and Repair Assistance

If you’re already a rural homeowner and your house needs repairs, or

modifications to make it accessible to a person with a disability, you may be

eligible for home improvement or repair assistance through USDA Rural

Development.

Single-Family Housing Home Improvement Loans (Section 502)

In addition to providing loan funds for the purchase of a house, the Section

502 Single Family Housing Direct Loan program can help lower income rural

homeowners make vital improvements to their homes. Section 502 loans are

available to make substantial home repairs when other loan options are not

available.

Home Repair Loan and Grant Programs (Section 504)

For families and individuals with very low incomes, Rural Development makes

loans for repairs, to improve or modernize a home, make it safer or more

sanitary, or to remove health hazards. For seniors 62 and older who cannot

afford

a loan, grant funds are available for these repairs.

The most common types of repairs financed by the Section 504 program include

fixing or replacing roofs, modernizing heating and wiring systems, and making

houses accessible to people with disabilities.

You can also apply for funds to install insulation and storm windows, put in

a septic system, and install or repair a bathroom.

The maximum amount you can borrow under the Section 504 Home Repair Loan

program is $20,000. The interest rate for these loans is 1 percent and is

limited to very-low-income, rural residents whose incomes fall below 50 percent

of

the area's median income.

For very-low-income homeowners 62 years old and older who can't afford to

borrow the full amount required to make necessary repairs, grant funds are

available. Grants may be used to remove health or safety hazards or to remodel

dwellings or make them accessible to household members with disabilities. Grants

are limited to $7,500. They are often combined with loans to increase the

amount available for repairs.

Housing Preservation Grant Program

Under this program, nonprofit organizations, public bodies, and Native

American tribes renovate deteriorating homes and rental properties using grants

from Rural Development. Grant funds are used to repair and bring up to code

properties occupied by families with low incomes. Your USDA Rural Development

local office can tell you if a Housing Preservation initiative is operating in

your area.

We ’re Here To Help

If you want to buy an affordable house in a rural area, USDA Rural

Development employees want to help. They can tell you about the various programs

available through Rural Development and assist you in applying for them.

Further information on all of USDA's housing programs is available at the

USDA Rural Development office serving your area. These are usually listed in

telephone books under " United States Government, Department of Agriculture. "

Information is also available on the USDA Rural Development website at

_http://www.rurdev.usda.gov/Housing Programs/index.html_

(http://www.rurdev.usda.gov/rhs/index.html) , or contact the Housing Programs at

the following address:

Housing Programs

USDA Rural Development

STOP 0701

1400 Independence Avenue, SW

Washington, DC 20515-0701

To be connected to your Rural Development state office, dial (202) 720-4323

and press 1.

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