The Rural Housing Repair Loans and Grants Program

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USDA Offers Loans and Grants to Repair Rural Homes. Lori Greig/Getty Images

The Rural Housing Repair Loans and Grants program, administered by the US Department of Agriculture, provides loans and grants to very low-income homeowners to repair, improve, modernize, or to remove health and safety hazards in their rural homes.

Loans are arranged for up to 20 years at 1 percent interest. Grants may be arranged for recipients who are 62 years of age or older and can be used only to pay for repairs and improvements to remove health and safety hazards.

Loan/grant combinations may be arranged for applicants who can repay part of the cost. Very low-income for this program is defined as below 50 percent of the area median income.

General Program Requirements

The Rural Housing Repair Loans and Grants program provides loans and grants to very low-income homeowners to repair, improve, or modernize their homes or to remove health and safety hazards. You must be a U.S. citizen or permanent resident who lives in a rural area.

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Basic Qualifications

To qualify, you must:

  • Be the homeowner and occupy the house
  • Be unable to obtain affordable credit elsewhere
  • Have a family income below 50 percent of the area median income
  • For grants, be age 62 or older and not be able to repay a repair loan

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 only to homeowners who are 62 years old or older and cannot repay a loan.

How Much Money Can You Get?

  • Maximum loan is $20,000
  • Maximum grant is $7,500
  • Loans and grants can be combined for up to $27,500 in assistance

What About Mobile Homes?

Loan and grant funds may also be used to make repairs and modifications to mobile homes provided that:

  • the applicant owns both the home and the site and has occupied it before applying for the loan or grant;
  • the mobile home is on a permanent foundation or will be put on one using the loan or grant; and
  • the mobile home is in need of repairs to remove health or safety hazards.

Loan Terms

Loans of up to $20,000 and grants of up to $7,500 are available. Loans are made for up to 20 years at 1 percent interest. A real estate mortgage is required for loans of $7,500 or more. Full title services are required for loans of $7,500 or more. Grants may be forfeited if the property is sold in less than three years. Loans and grants can be combined for up to $27,500 in assistance.

Application Process

To apply for a loan or grant, or you should contact your state's Rural Development field office. You can also talk to a USDA home loan specialist in your area for help with the application.