Section 504 Direct Loan Program-Fact Sheet 

HOW TO APPLY:

Click here for a list of Rural Development Area Offices. Basic information can be provided over the telephone, and an application will be mailed to you to be completed and returned to the office; or an appointment will be scheduled.

PROPERTIES:

Single family dwellings located in rural areas of Maine, currently owned and occupied by the applicant.

Applicant must be able to document ownership.

Dwelling must be modest. Some areas are ineligible.  Click here to access interactive website.

LOAN PURPOSES:

Repair, improve, or modernize modest single family dwellings. Some restrictions apply to mobile or manufactured homes.

FEES:

Tax service fee of $110.00 and Appraisal fee of $325.00 only for loans over $15,000; otherwise none.

DOWN PAYMENT:

None required.

MAXIMUM TERM:

Loans 20 years.

INTEREST RATE:

1.0%.

SECURITY REQUIREMENTS:

Loans in excess of $7,500 will be secured by a mortgage on the property.

Loans in excess of $7,500 will require title search and closing by an attorney.

ESCROW:

Loans over $15,000 will require escrow for the payment of Real Estate Taxes and Property Hazard Insurance.

REFINANCING:

Not allowed.

INCOME LIMITS:

HUD very low income limits – Click here for a list of income limits. Based on Adjusted Family Income as defined in Rural Development regulations, must be at or below very low income limit.

ELIGIBILITY:

Must be U. S. Citizen or qualified alien

Very Low Income Category

TIME TO DETERMINE ELIGIBILITY:

Within 30 days of receiving a complete application.

Eligibility determination includes a field visit to property to determine health hazards.

MAXIMUM ASSISTANCE:

Loans cannot exceed $20,000.

OTHER CREDIT:

Must not be able to obtain other credit through conventional sources, including a Rural Development Guaranteed loan.

AVAILABILITY OF FUNDING:

Funding is limited, priority given to hardship situations. 

Click here to obtain more information on our 504 program, or to request an application.

If you would like to review USDA Regulations, Procedures, Notices, RD Forms, or RD Handbooks, Click Here.

Return to Single Family Housing Loans and Grants.