Rural Repair and Rehabilitation Loans and Grants
Purpose: The Very Low-Income Housing Repair program provides
loans and grants to very low-income homeowners to repair, improve, or
modernize their dwellings or to remove health and safety hazards.
Eligibility: To obtain a loan, homeowner-occupants must be unable
to obtain affordable credit elsewhere and must have very low incomes,
defined as below 50 percent of the area median income. They must need to
make repairs and improvements to make the dwelling more safe and sanitary
or to remove health and safety hazards. Grants are only available to homeowners
who are 62 years old or older and cannot repay a Section 504 loan.
For Income and Property Eligibility please see our
Terms: Loans of up to $20,000 and grants of up to $7,500 are available.
Loans are for up to 20 years at 1 percent interest. A real estate mortgage and
full title services are required for loans of $7,500 or more. Grants may be
recaptured if the property is sold in less than 3 years. Grant funds may be used
only to pay for repairs and improvements resulting in the removal of health and
safety hazards. A grant/loan combination is made if the applicant can repay part
of the cost. Loans and grants can be combined for up to $27,500 in assistance.
Standards: Repaired properties do not need to meet other HCFP code requirements,
but the installation of water and waste systems and related fixtures must meet local
health department requirements. Water supply and sewage disposal systems should normally
meet HCFP requirements. Not all the health and safety hazards in a home must be removed
with Section 504 funds, provided that major health and safety hazards are removed. All work
must meet local codes and standards.
Basic Instruction: 7 CFR Part 3550 and HB-1-3550
For more information about this program, or to file an application, contact the local
Rural Development office in your area.