Home Ownership Programs

502 Guaranteed Program

Provides financing to purchase a home. Private lenders make and service the loan. Rural Development provides a guarantee to back the security of the loan to the lender. Applicants with moderate or low incomes are eligible to apply for these loans. Contact your nearest Rural Development field office for approved lenders in your area. Loan funds may be used to build new homes or buy existing homes, which are in good condition and meet Rural Development guidelines. The private lender sets the interest rate. Loans may be made for up to 100 percent of the value. (Field Office Map)

502 Direct Program

Provides financing to purchase a home or repair a home already owned. Loans are made through the Rural Development field offices. Loans are serviced by Rural Development Central Servicing Center located in St. Louis. This program is available to low and very low families and individuals. Interest rates are fixed for the life of the loan. Depending on income, qualified buyers may have their payments reduced through payment assistance. (Field Office Map)

502 Mutual Self Help Program (not available in all areas)

This program assists families to build their own home. A group of 8 to 12 families and individuals work together under the guidance of a construction supervisor hired by a nonprofit housing developer. The group performs 65% of the construction work. By working together for 8 to 10 months, a home is built for each family in the group. No one moves in until all the homes within the group are completed. Currently the program is available in locations served by the following field offices: El Dorado, Manhattan, Hays and Garden City.

Non profit organizations interested in administering a Self Help Program should contact Norman Reed at 785-271-2718 or email norman.reed@ks.usda.gov

Leverage loans

Many Rural Development loans are made in partnership with financing from other programs or institutions. Some programs we partner with have loan products that are designed to help lower income families and individuals afford home ownership. These programs offer dollars towards the purchase of the home that are zero percent interest and forgiven over time if conditions are met.